H. Oosterbeek, M. van Praag and A. IJsselstein, Institute for the Study of Labor Discussion Paper No.3641
Oosterbeak et al (2008) evaluate the impact of the Junior Achievement Student Mini-Company (SMC) entrepreneurship education programme, the European and American equivalent of the Young Enterprise programme in the UK, on college students’ entrepreneurship competencies and intentions. They find the programme has no impact on the development of entrepreneurial competencies amongst participating students and a (statistically significant) negative effect on entrepreneurial intentions.
The Junior Achievement Student Mini-Company (SMC) programme is a year-long course undertaken by college students in which they follow the life cycle of a small business from start-up to liquidation. The experience mirrors reality as closely as possible, with students selling stock, electing officers, producing and marketing products, keeping records and conducting shareholders’ meetings throughout the year. The course involves 5-10 hours of work a week, involves teams of approximately ten students, and is managed by a team of lecturers. Employee volunteers usually as team coaches, mentors and competition judges.
The evaluation was carried out at a vocational college with two campuses in the Netherlands during the academic year 2005-2006. The SMC programme was introduced for Students at one campus (the treatment group) but not for students at the other campus (the control group). The research accounted for differences in background, demographic and residence between the two locations, using a ‘difference-in-difference’ framework. Furthermore, the authors used an ‘instrumental variables’ approach to account for any error in the ‘difference-in-difference’ analysis.
To assess the net effect of the SMC programme, the authors used E-scan, a self-assessment test used in psychology and business studies in the Netherlands, to measure students’ entrepreneurial competencies. In addition, a short questionnaire was used to gather information about students’ backgrounds and future intentions in terms of becoming an entrepreneur. Students completed both the E-scan and survey before the programme started to measure pre-treatment competencies and students completed the E-scan test regularly map changes in self-perception during the course of the SMC programme. A total of 562 students took part in the study; there were 250 valid responses after post-treatment surveys.
The results suggest that the SMC programme did not have its intended impact: participation had no impact on the development of entrepreneurial competencies and a (statistically significant) negative effect on entrepreneurial intentions. Some lecturers and business coaches suggested this negative effect may be a consequence of more realistic expectations around entrepreneurship amongst participants. Other possibilities include the fact that participation was mandatory and it required a lot of time and effort through the entire year whilst not contributing greatly to academic credit. The large group numbers may have further frustrated the experience.
Oosterbeak et al (2008) recommend that more studies should be undertaken to evaluate the impact in a wider range of schools. They also recommend more research into the impact of variables such as students’ team size, the length of the programme, the compulsory nature of participation and the number of academic credits students will earn on completion, which may have influenced the negative net effect of the programme on entrepreneurial intentions.