Global Resources

Entrepreneurship and poverty status among female household participants in small and medium scale enterprises in Lagos State, Nigeria

Author: M. A. Okunnu, A. Akinjole
Publisher: Journal of Business Administration and Management Sciences Research
Publication Date: Feb 2016

Despite being a country rich in resources, both human and natural, many Nigerians remain poor, something described by the World Bank as “poverty amongst plenty”.  This poverty is gendered in nature, with Nigerian women disproportionately, and increasingly, more likely to be living on less than $1 a day. This lack of assets, combined with the unfair distribution of household and family duties, prohibits women from engaging in entrepreneurial activities, and thus can deprive them of potential routes out of poverty. To better understand, and help overcome, this problem, this research paper seeks to answer the following questions: What are the various government SME development programmes in Lagos state? What are the determinants of poverty among female households in the state? And does women’s participation in SMEs affect poverty status of women?


The research primarily focused on identifying the effect of female participation in SMEs on poverty status of women households in Lagos State, Nigeria. A multistage sampling technique was employed to collect data from 114 respondents, comprising 56 Small and Medium Scale Enterprises (SMEs) participants and 58 non-participants. The theoretical and conceptual frameworks used in the study are the Schumpeterian Theory of Entrepreneurship, Vroom theory of expectancy, poverty theories and Development Theory of Poverty Reduction, all of which are discussed. Additionally, the study empirically examines the literature available on women entrepreneurship and poverty.


The study revealed that the female households who were non-participants in SMEs had a poverty incidence level of 60%, while SME participants’ poverty incidence was less than 15%. SME participants benefited directly from government entrepreneurship programmes, whereas the non-participants did not enjoy any direct benefit. The estimated regression analysis revealed that educational status, participation in SMEs, access to microfinance credit, household income, and monogamous household type are all statistically significant factors that reduce poverty status of households.


The study concludes with policy recommendations designed to enhance female entrepreneurship development as a potential panacea to escape from rural household poverty in the state:

  • Entrepreneurial education should be included in all primary and post-primary educational institutions, and Incubatory centres should be provided to facilitate practical entrepreneurial education, encourage trainees to put new skills to use, and support them in starting their own enterprises.  

  • There is need for more family planning provision, e.g. birth control, in order to reduce the dependency ratio of households.

  • There is need for campaigns to raise awareness on the existing vocational and skills acquisition centres, in order to increase SME participants and help them in escaping poverty.  

  • Government should create an enabling environment by providing infrastructure and support to aid infant and extant entrepreneurs.

  • Households should be encouraged to join cooperative societies. This would afford them access to some government and donor agencies assistance, and provide support to entrepreneurs.