ROLE OF FOREIGN DIRECT INVESTMENT IN FACILITATING ENTREPRENEURIAL INTENTIONS THROUGH TECHNOLOGY TRANSFER IN KENYA

Lucy Kinyua

PhD. in Entrepreneurship, Jomo Kenyatta University of Agriculture and Technology, Kenya

Prof. Elegwa Mukulu

Director SHRD, Jomo Kenyatta University of Agriculture and Technology, Kenya

Dr. Waititu A. Gichuhi

Lecturer, Jomo Kenyatta University of Agriculture and Technology, Kenya

ABSTRACT

Technology transfer is a key benefit of Foreign Direct Investments (FDIs) in the developing countries. It is closely related to the process of human capital formation. Transfer can happen through engagements such as the FDIs subcontracting local firms and suppliers, training programs of employees, raising standards in workplace environment and other spin-off benefits. There is a strong believe that FDIs have  superior production technology and management techniques, some of which are transferred or diffuse  to  local firms when the FDIs locate in a particular economy.   Kenya has attracted a large number of FDIs from various parts of the world over the years. However, no extensive research has been undertaken on the contribution of FDIs to entrepreneurship growth in Kenya. This paper analyses the contribution of FDIs in influencing entrepreneurial intentions among the Kenyan employees through technology transfer. It is based on a study carried out in Kenya to identify the role of foreign direct investment in promoting entrepreneurship growth through entrepreneurial intentions among local employees. The study adopted a descriptive research design and targeted FDIs located within Nairobi County. A multistage sampling technique was used with the first step sampling the FDIs, 30 firms were selected.  The second step involved sampling of employees within the firms and a sample of 256 was selected. A questionnaire was used for data collection. To verify its validity a pilot study was carried out and the Cronbach alpha reliability index of 0.70 was used. For data analysis there was use of the Statistical Package for Social Sciences (SPSS), t- tests and the Analysis of Variance (ANOVA). The findings revealed that foreign investors enhanced entrepreneurial intentions among the local employees through technology transfer.

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