Financial literacy and business risk-taking among business start-up students in Nigeria

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Low business outlook due to poor financial decisions among students has continued to attract interest of financial educators and professionals. Previous studies have interrogated financial literacy with sparse attention given to business risk-taking among students’ start-ups in Nigeria. This research gap forms the basis of this study. The aim of this paper is the interrogation of financial knowledge and financial behavior as a lever for business risk-taking among start-up students of the University of Lagos, Nigeria. The philosophical perspective drew insight from the positivist approach with a random sampling of 145 final-year students selected from the departments of Business Administration, Accounting and Employment, and Labour Relations of the Faculty of Management Sciences. Kaiser-Meyer-Olkin test and Bartlett’s test were conducted to determine sample adequacy. Regression analysis was employed to test the hypotheses. The results show that financial knowledge and behavior of start-ups revealed a high propensity to be engaged in business risk-taking (β = .407, t (511) = 7.556, p < 0.05; β = .412, t (1.511) = 7.525, p < 0.05) with males showing more financial literacy understanding for business risk than females (β = .591, t (2;510) = 4.381, p < 0.05; β = .280, t (2;510) = 2.217, p = 0.262) respectively. The findings show the need for the continuous development of students’ start-up behavioral and attitudinal disposition, especially females in becoming more financial literate for appropriate financial decision-making in business risk-taking and venture creation.

Acknowledgments
The author acknowledges and appreciates all students who participated in this study.

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    • Table 1. Validity and reliability of variables
    • Table 2. Financial knowledge and financial behavior as predictors of business risk-taking
    • Table 3. Financial literacy as a predictor of business risk-taking
    • Table 4. Gender differences between financial literacy and business risk-taking
    • Conceptualization
      Samson Adewumi
    • Data curation
      Samson Adewumi
    • Formal Analysis
      Samson Adewumi
    • Investigation
      Samson Adewumi
    • Methodology
      Samson Adewumi
    • Project administration
      Samson Adewumi
    • Software
      Samson Adewumi
    • Supervision
      Samson Adewumi
    • Validation
      Samson Adewumi
    • Writing – original draft
      Samson Adewumi
    • Writing – review & editing
      Samson Adewumi