A Study on the Barriers to Entrepreneurship in the UAE

Abstract

A variety of factors have an influential impact on how an enterprise develops. This study examined factors that operate as market barriers to entrepreneurship in the United Arab Emirates. These factors are fear of failure, risk aversion, lack of social networking, lack of resources, political instability, and economic instability. A survey-based approach framework was used. This survey recruited 150 participants, including UAE students, business owners, and budding entrepreneurs. Multiple-item survey questionnaires and secondary data were used in the data analysis process to identify and evaluate the barriers preventing people from starting new businesses and becoming entrepreneurs in the United Arab Emirates. According to the research results, fear of failure, risk aversion, and lack of resources in the United Arab Emirates make it difficult for business owners to launch brand new business ventures.

1. Introduction

Understanding entrepreneurship as a cycle highlights the critical steps necessary to transform an idea into a profitable firm. It highlights many facets that influence the myriad of tasks that business owners must complete to bring a concept to fruition (Hojnik et al. 2019).

It is probable that some business practices that are appropriate in one environment may not be applicable in another environment. The contextual nature of different business environments plays an influential part in the process of entrepreneurial venture formation (Sitaridis and Kitsios 2016).

Based on the information mentioned above, one may assume that the steps involved in starting a business by small business entrepreneurs differ from those typically taken by prominent business entrepreneurs. Likewise, barriers faced by single-location restaurant entrepreneurs may differ from those starting their entrepreneurial ventures as multi-chain restaurant owners because resources, organizational size, and legal structures of large-scale entrepreneurial ventures are not directly comparable to those of small- scale entrepreneurial ventures (Ratten 2014).

Moreover, entrepreneurship development in Western countries may differ from that in Gulf countries, such as the United Arab Emirates. Businesses in the United Arab Emirates are characterized by government rules (Tlaiss 2014), dependence on “wasta” (personal connection) (Yasin et al. 2021), and extended family relationships that provide material, emotional, and social support (Zarrouk et al. 2020). In the 21st century, the changes that entrepreneurs must deal with while starting their businesses can be exceedingly challenging. In these situations, the UAE government has a positive reputation among small business owners.

As one of its goals, the government of the United Arab Emirates has aimed to depend more on non-oil resources and development projects (both large-scale and small-scale) as a foundation for economic growth. The Sheikh Rashid Establishment for Young Business Leaders is one of the groundbreaking initiatives the government has undertaken to foster entrepreneurship in the UAE. Additionally, entrepreneurship is becoming increasingly popular as a career choice in UAE.

A detailed examination of the industry reveals that business owners in the UAE frequently face various unforeseen and difficult-to-foresee challenges. In the UAE, every new company, whether small- or medium-sized, faces several well-known obstacles. These include insufficient money, not having enough people with the right skills, difficulties gaining a competitive edge, and other problems. Moreover, it has been found, via theoretical and empirical analyses from the perspectives of psychology and business sciences, that few studies in the UAE have examined the impact of barriers on the growth of entrepreneurship among small businesses. Most of the reviewed literature focuses on investigating these phenomena in the context of large-scale entrepreneurial endeavors and economies. In light of the dynamics involved in creating and maintaining entrepreneurial ventures, this necessitates a more systematic knowledge of entrepreneurial activities inside the UAE. With this goal in mind, this research was designed to comprehend the process of establishing and maintaining entrepreneurial initiatives in the UAE to pinpoint the elements that restrict them. This has implications for executing research focusing on how different factors serve as barriers for small business entrepreneurs in the UAE. Based on the concept that different sizes of entrepreneurial ventures possess diverse conditions that influence their success, this paper aims to study the barriers that inhibit small business entrepreneurs in the UAE market.

2. Literature Review

2.1. Entrepreneurship and Barriers to Entrepreneurship Development

Entrepreneurship is an increasingly important factor in economic growth, innovation, productivity, and employment (Tracey and Phillips 2011; Shinnar et al. 2012). Casson (1982) states that the essence of entrepreneurship is having different ideas about the world around you. Any entrepreneurial activity begins with a business opportunity, discovery, and then the decision to take advantage of the opportunity. A person who starts a new business is known as an entrepreneur. They are someone who can find opportunities and turn those opportunities into businesses that make money. In 1988, Gartner defined entrepreneurship as a wide range of activities, such as starting a business. Morris (2001) thought that entrepreneurship is a significant part of economic growth (Stephan et al. 2015). Considering the general definition of Hisrich (2014), an entrepreneur is someone who creates something new that can result in benefits and who, therefore, faces financial, social, and psychological risks, while aiming to reach a particular reward, which is manifested in the form of satisfaction and economic and social independence. Drucker (2014) corroborates this line of thought and argues that an entrepreneur is an individual who takes a stand in front of reality (risks, restrictions, and challenges) to convert it into an opportunity, with the aim of generating favorable results and profits. According to a definition offered by Ozaralli and Rivenburgh (2016), entrepreneurship is the process of creating something of value by allocating the necessary time and resources and taking on the corresponding psychological, social, and financial risks to achieve the desired outcomes.

Recent research has discussed the ‘entrepreneurial profile’ from an individual perspective. The literature indicates that a series of behavioral characteristics intrinsic to individual personality makes a person an entrepreneur (Sandhu et al. 2011; Stephan et al. 2015). On the other hand, it is identified that the action of being an entrepreneur constitutes a continuum of behaviors (individual factors) and contexts (social and environmental factors) that turn a potentially entrepreneurial individual into an entrepreneur (Remeikiene et al. 2013; Galindo and Méndez-Picazo 2013).

The literature suggests that entrepreneurs face internal or external obstacles (Şeşen and Pruett 2014). Internal barriers to entrepreneurship development include all elements and procedures that undercut and impede the growth and progress of organizations from within, including a lack of, among other things, leadership, capital, supportive work environment, knowledge, and resources (Wijeyeratnam and Perera 2013). On the other hand, external barriers could include an unfavorable business climate, fierce competition, and unstable political and governmental policies that could lead to business venture failure (Acs and Virgill 2010).

In addition to the individual, contextual, internal, and external dimensions of barriers associated with entrepreneurship development, the psychological perspective, the institutional perspective, and the social capital perspective have been identified in the previous research works to examine barriers that inhibit entrepreneurship development.

2.2. Psychological Barriers

Psychological barriers to entrepreneurship development have been extensively studied in the literature. Psychological barriers are essential for entrepreneurship development because they can significantly influence an individual’s decision to start a business (Naderi et al. 2022). Psychological barriers can also affect the success of a new venture (Tremml 2021). Subramaniam et al. (2022) mentioned that psychological obstacles, such as fear of failure or lack of self-confidence, can deter individuals from pursuing entrepreneurial opportunities. This can result in missed opportunities for economic growth and job creation. Moreover, psychological factors, such as stress and poor well-being, can negatively influence the success of a new venture (Naderi et al. 2022; Tremml 2021). Entrepreneurs who experience high stress levels or poor well-being may struggle to effectively manage their businesses and make good decisions (Ali et al. 2019).

The literature highlights several key psychological barriers to entrepreneurship development, including fear of failure, lack of self-confidence, risk aversion, lack of motivation, lack of information, social and cultural factors, and poor psychological well-being. A recent study by Dutta and Sobel (2021) indicated that fear of failure is a common psychological barrier that prevents individuals from starting their businesses. According to the research study by Duong (2022), fear of failure can prevent individuals from taking the necessary risks to start a new venture, resulting in missed opportunities for economic growth and job creation. Moreover, Dutta and Sobel (2021) proclaimed that fear of failure could lead to decreased motivation and a lack of confidence in one’s abilities to manage their business and make good decisions effectively.

In addition, entrepreneurship requires high self-confidence and belief in one’s abilities. However, many individuals lack the self-confidence needed to start a business. Huang and Yang (2022) indicated in their research that low confidence levels could limit the willingness of entrepreneurs to take risks and pursue opportunities, leading to decreased entrepreneurial activities. According to Aiello et al. (2019), high levels of risk aversion can also limit entrepreneurial behavior by reducing the likelihood of individuals engaging in risky endeavors. Moreover, psychological well-being has been shown to positively influence entrepreneurial behavior, with entrepreneurs reporting higher well-being levels than non-entrepreneurs. This can be due to the sense of control and autonomy that comes with being an entrepreneur and the potential financial rewards and personal fulfillment associated with success. However, starting and running a business can also be stressful and negatively influence psychological well-being, particularly in the face of failure (Aiello et al. 2019).

These barriers are important considerations for individuals seeking to start their businesses and for policymakers seeking to promote entrepreneurship. Psychological barriers are essential for entrepreneurship development because they can influence an individual’s decision to start a business, the success of a new venture, and the efforts of policymakers to promote entrepreneurship (Ali et al. 2019; Subramaniam et al. 2022). Addressing these barriers can help support new business development and encourage economic growth.

2.3. Institutional Barriers

The literature has also extensively investigated institutional barriers to the growth of entrepreneurship (Daneshniya et al. 2021; Gunawan et al. 2022). Institutional barriers are essential to consider because they can significantly impact the growth and development of entrepreneurship (Hoogendoorn et al. 2019). Al-Jubari and Mosbah (2021) indicated in their research work that when institutional barriers are present, they can create hurdles for entrepreneurs, making it more difficult for them to start and grow successful businesses. This can have a negative impact on economic growth, job creation, and innovation, as well as limit the potential for individuals to improve their financial stability and well-being through entrepreneurship (Khodapanah et al. 2021; Ferreira et al. 2017). Furthermore, institutional barriers can perpetuate income inequality and restrict access to opportunities, particularly for marginalized communities who may already face other challenges in starting a business (Daneshniya et al. 2021).

Institutional barriers to entrepreneurship development can take many forms, including lack of access to finance, regulatory barriers, infrastructure, and political instability. Bouichou et al. (2021) mentioned in their research that entrepreneurs might struggle to secure funding for their businesses due to a lack of access to traditional financing sources, such as banks or venture capital. Likewise, regulations and red tape can also create hurdles for entrepreneurs, making it difficult and time-consuming to start and run a business (Chambers and Munemo 2019). According to previous research work, instability in the political environment can also create uncertainty for entrepreneurs, making it more difficult for them to make long-term investments in their businesses (Motamedi Nia et al. 2021).

These institutional barriers are vital because they can limit the number of individuals who can start and grow successful businesses. This can negatively impact economic growth, job creation, and innovation (Gunawan et al. 2022). Addressing these barriers can help create a more supportive environment for entrepreneurs, enabling them to start and grow successful businesses and contribute to the economy (Daneshniya et al. 2021). Considering institutional barriers is important for policymakers, business leaders, and other stakeholders interested in promoting entrepreneurship and economic development. By understanding and addressing these barriers, it is possible to create a more supportive and enabling environment for entrepreneurs, empowering them to start and grow successful businesses and contribute to the economy.

2.4. Social Capital Barriers

Social capital is important for entrepreneurs because it refers to a person’s networks, relationships, and connections, which can provide benefits and opportunities for personal and professional development (Putro et al. 2022). In a research study conducted by Bahagia et al. (2022) with entrepreneurs, having substantial social capital can provide access to valuable resources, such as capital, mentorship, and expertise, as well as opportunities to form partnerships and make connections with potential customers. Hidalgo et al. (2021) identified that a lack of social networks could also be a barrier for entrepreneurs as it limits their reach and ability to connect with potential customers, partners, and other industry players.

A variety of social capital barriers can hamper the development of entrepreneurship. For instance, Kamble (2022) found that entrepreneurs from underprivileged backgrounds or who live in less connected neighborhoods may have less access to networks that might connect them to significant opportunities and resources. Additionally, a network with a uniform background, industry, or point of view may pass up significant chances and insights. Moreover, social networks are crucial in building brand awareness, networking, and driving sales in today’s digital age. Putro et al. (2022) mentioned that without access to these platforms, entrepreneurs might miss out on significant opportunities to connect with their target audience and grow their businesses. Therefore, entrepreneurs need to consider the availability and relevance of different social networks when developing their marketing and networking strategies (Hidalgo et al. 2021). By recognizing these barriers and developing strategies to overcome them, entrepreneurs can build substantial social capital and maximize the benefits of their networks.

2.5. Theoretical Framework

We contend that the challenges that are faced by large-scale entrepreneurial ventures may differ from those of small scale entrepreneurial ventures. Past research shows that most of the challenges that are faced by large-scale entrepreneurial ventures are institutional ones, such as not getting enough help from the government, not having enough money, having issues with the infrastructure, not having enough training, having bad contracts and property laws, and facing corruption (Lofstrom et al. 2014). On the other hand, most of the problems small business owners face are psychological (Smith and Beasley 2011). The barriers chosen for this study come from three different schools of thought: psychological, institutional, and social capital. This is because these ideas are more critical to our unit of analysis: small business owners. Below is a more in-depth look at each of these factors.

2.5.1. Fear of Failure

Fear of failure is mainly looked at as a psychological factor that stops people from being an entrepreneur and acts as a barrier to entrepreneurship in entrepreneurship research (Hosseini et al. 2010). Despite the findings of many studies which indicate that a fear of failing has a detrimental effect on entrepreneurial activities (Tracey and Phillips 2011; Stamboulis and Barlas 2014; Mathew 2010), there is some empirical research that points to the likelihood of fear of failure in the business world eliciting both motivating and inhibiting responses from entrepreneurs (Cacciotti and Hayton 2015). Every entrepreneur knows the fear of taking the reins of a new venture (Tracey and Phillips 2011). Startup and development efforts are fraught with the anxiety and thrill of tackling a wide range of activities, any one of which might lead to the demise of the business. These tasks include introducing new goods and services, raising capital, fostering connections with loyal consumers, maximizing profits, etc. As entrepreneurs, people feel both the thrill and the terror of taking on a wide range of challenges, any one of which may end in disaster (Nefzi 2018). The importance of failure anxiety to entrepreneurial success has been the subject of growing academic scrutiny in recent years (Dutta and Sobel 2021). Some academics have described fear of failure as a fixed motivational disposition that keeps people from taking risks (Tubadji et al. 2021). Others have considered it as a distressing emotional state that makes entrepreneurs less optimistic about prospects (Cho et al. 2019), while yet others have attempted to investigate how entrepreneurs perceive fear of failure (Ferreto et al. 2018; Pinto et al. 2019).

2.5.2. Risk Aversion

On the one hand, a risk-averse society makes starting a business more expensive and less likely to succeed since not only lenders and investors are risk averse but also entrepreneurs. This could be a significant obstacle for entrepreneurs. However, aversion to risk may also be a factor in successful entrepreneurship. Some risk-averse persons who have long been thought to be intrinsically unsuited to entrepreneurship may be well suited to this line of work (Mahola et al. 2019). However, there is evidence that one of the obstacles to entrepreneurship is an aversion to risk. The idea of a person who takes risks typically serves as the foundation for the most prevalent definitions of an entrepreneur (Aderibigbe et al. 2019). Entrepreneurs, however, work to control and reduce risks (Tremml 2021). According to Hagos et al. (2018), entrepreneurs take and reduce risks. Risk takers are more attracted to entrepreneurship, even when taking chances could ultimately hurt their company’s bottom line. Risk aversion is anticipated to have a detrimental effect on the intention to be entrepreneurial, as mentioned above.

2.5.3. Lack of Social Networking

Research on social capital considers the significance of the social environment in which new businesses have launched and the role that cultural and social factors play in forming entrepreneurs (Chandra et al. 2020). Although the concept of social capital has been the subject of discussion in published works for a considerable time, academics have not yet agreed on a single definition for the term (Hagos et al. 2018). Numerous studies define social capital as a relationship with social networks because social networks are necessary to produce social capital (Tremml 2021). Consequently, social capital results from social bonds created through encounters (Smith et al. 2020). Advantages that people can experience due to social contacts and networking include information interchange among network participants, cooperative benefits, shared norms and values, existing and anticipated resources (Wheadon and Duval-Couetil 2019). Social capital is credited with numerous advantages, even with limited material means. As it pertains specifically to entrepreneurship, social capital is believed to ease communication, lower transaction costs, lower the price of knowledge, and facilitate its flow (Cho et al. 2019). Since many start-ups’ internal resources are scarce in their infancy, social networking may play a significant role in their development (Sharma 2018). We propose that social networking substantially inspires entrepreneurship in developing countries such as the United Arab Emirates. Accordingly, a lack of social networking might stunt the growth of entrepreneurship.

2.5.4. Lack of Resources

Both tangible and intangible resources are considered part of the business environment. Tangible resources include legal frameworks, human capital, and administrative processes. Physical resources include roads, water, and energy, among others. Thaler et al. (2019) assert that resource availability stimulates entrepreneurial activity growth. Studies have also shown that entrepreneurs face several challenges, including a deficiency in financial resources and a lack of knowledge on various business-related topics, such as high tax rates and inflation rates (Shahverdi et al. 2018). Entrepreneurs who start new businesses must contend with the difficulties of obtaining funding and financing in a banking system that requires collateral and track records (Shahverdi et al. 2018). In addition, when explicitly asked about it during interviews, prospective business owners stated that the most challenging obstacle they face is soliciting financial support. According to the research conducted by Bigliardi et al. (2022), one of the challenges that is faced by small businesses is a lack of resources.

2.5.5. Instability in the Economic Environment

Despite a general trend toward an increase in their growth rates, developing countries typically exhibit a common trait known as economic instability as they progress through the stages of their development. Changes in aggregate demand, capital, export earnings, and currency fluctuations are common in a developing economy. This makes it challenging a new business to start and remain in business. The economy’s current conditions may negatively influence business ownership (Foss et al. 2019). The adverse effects will be amplified if lending institutions become more conservative and, as a result, less willing to extend credit to business owners.

2.5.6. Instability in the Political Environment

Stability in government is necessary for fostering an entrepreneurial spirit in developing countries (Fakoussa et al. 2020). A study by Zhang et al. (2020) found that political instability harms entrepreneurial intentions when they used structural equation modeling to depict the factors that come before entrepreneurial intentions. However, no evidence can be construed as definitive when linking entrepreneurship to political stability; consequently, the connection between the two deserves additional investigation.

2.6. Hypothesis Development and Conceptual Framework

According to the model developed for this research, the independent variables include factors associated with psychological perspective (fear of failure and risk aversion), institutional perspective (political and economic instability), and social capital perspective (lack of resources and lack of social networking) have a substantial effect on entrepreneurship development. The conceptual foundation of this study is shown in Figure 1:

Thus, in line with these findings, the following hypotheses are proposed:

• H1: Fear of failure significantly hinders entrepreneurship development among small businesses in the UAE.
• H2: Risk aversion significantly hinders entrepreneurship development among small businesses in the UAE.
• H3: Lack of social networking significantly hinders entrepreneurship development among small businesses in the UAE.
• H4: Lack of resources significantly hinders entrepreneurship development among small businesses in the UAE.
• H5: Instability in the economic environment significantly hinders entrepreneurship development among small businesses in the UAE.
• H6: Instability in the political environment significantly hinders entrepreneurship development among small businesses in the UAE.

3. Materials and Methods

A study with 150 individuals in the United Arab Emirates was conducted to learn more about the factors that contribute to the growth of entrepreneurship among the country’s workforce, jobless population, and company owners of small enterprises. Respondents from different backgrounds were recruited because the responses from such a diverse group could give a better insight into how people feel about starting a new business. Many respondents might already be running their enterprises or have plans to do so. The respondents were recruited using a convenience sampling protocol considering the availability of the respondents to the researcher for the data collection process.

To achieve a response rate of one hundred percent, the researchers who conducted the study handed out the questionnaires, waited for the respondents to finish filling them out, and then personally collected the questionnaires. The survey questionnaire contained 23 items, 5 related to demographics and 18 related to individual perceptions. Each item was measured on a Likert scale with 5 points, ranging from 1 (strongly disagree) to 5 (strongly agree) Some respondents lacked a strong command of English, and thus every item was provided in both English and Arabic.

The data were analyzed using many different statistical methods. The identified factors were subjected to a regression analysis to determine how important they were to the prediction of the growth of entrepreneurship. The Statistical Package for the Social Sciences, version 19.0 (SPSS), was utilized for data analysis. The outcomes are presented in the following section.

4. Results

4.1. Profile of the Respondents

The respondents were heavily biased toward being young, with 56.4% in the 20–29 age range, 32.7% in the 30–39 age range, and just 8.9% in the 40-plus age bracket. Sixty-four percent of the respondents were males, while only forty-nine percent were females, according to the data. Only about a third of the respondents who filled out the survey were married. More than two-thirds (66%) of the respondents had college education, whereas 33.7% of the respondents had only completed their secondary education. Almost half of the respondents (46.5%) had monthly incomes of $1000 or less, while about a third (32.7%) made between $2000 and $3000 monthly.

4.2. Hypothesis Testing

To better understand how each independent variable affects the prediction of the dependent variable (in this case, entrepreneurship development), a regression analysis was performed. All variables’ relative importance and direction of effect can be deduced from their respective beta coefficients. SPSS 19.0 was used to conduct the regression analysis, and the model summary reveals an adjusted R-squared of 0.604. This indicates that the proposed model can predict roughly 60% of the variation in the development of entrepreneurship in the UAE. The correlation between the dependent and independent variables is represented by the R value. The value in this instance is 0.795, which is favorable. R-squared displays the overall variation in the dependent variable due to the independent factors. The R square value is 0.632, indicating that the independent variables in the model explain 63% of the variance in the data. We can speculate that the dependent variable is influenced by a wide range of variables not included in this model or that the remaining 27% of the dependent variable’s variation is related to variables that are not present in the model. The summary of the regression model is illustrated in

Table 1. Model Summary.

Model Summary
Model	1
R	0.795
R-squared	0.632
Adjusted R-squared	0.604
Std. Error of the Estimate	0.84134

.

The F statistic for the overall model is significant (19.84) and has a high significance level (Sig. = 0.000) in the ANOVA table, indicating that it is significantly different from zero. The ANOVA table and associated F-statistic results are illustrated in

Table 2. ANOVA.

Model		Sum of Squares	df	Mean Square	F	Sig.
1	Regression	113.286	8	14.161	19.840	0.000
	Residual	65.664	92	0.714
	Total	178.950	100

.

To identify each beta coefficient’s predicted power of entrepreneurship development, it is necessary to evaluate its statistical significance. The table of coefficients from the multiple regression analysis as illustrated in

Table 3. Hypothesis Summary.

Model	Beta	t	Sig.
1 (Constant)		42.283	0.000
Fear of failure	0.720	11.406	0.000
Risk aversion	−0.226	−3.576	0.001
Lack of social networking	0.122	1.932	0.056
Lack of resources	0.211	3.346	0.001
Instability in the economic environment	0.028	0.438	0.662
Instability in the political environment	−0.014	−0.222	0.825

reveals that the t-statistics for fear of failure, risk aversion, and lack of resources are statistically significant at p-values of 0.000, 0.001, and 0.001, respectively. In contrast, the t-statistic for the factors related to lack of social networking, instability in the economic environment, and instability in the political climate is not significant. As a result, this analysis identifies that H1, H2, and H4 are adequately supported. t = The discussion section provides a thorough explanation.

5. Discussion

The findings of this study have ramifications in both the theoretical and policy domains. This research is the first comprehensive study ever conducted on the obstacles that small business owners in developing countries, such as the UAE, face when trying to start their businesses. This research has been made more rigorous by including a number of different psychological and institutional barriers. Fear of failure, aversion to risk, and lack of resources are significant factors that influence the development of entrepreneurship among small business entrepreneurs in developing countries, such as the UAE, according to the study’s findings.

The findings of the multiple regression analysis reveal that fear of failing has a significant influence on the development of entrepreneurship in small business owners. Its t-statistic is significant (Sig. = 0.000), and its standardized beta coefficient is 0.720. This result is consistent with previous research carried out in other countries on small business entrepreneurs. In those studies, fear of failing was also ranked as an important factor influencing the development of entrepreneurship (Dutta and Sobel 2021). This indicates that self-assured new entrepreneurs on the rise may be actively discouraged from acting on entrepreneurship development out of fear of failing in their endeavors. It is possible to argue that the fear of falling short is an integral component of the path required to become an entrepreneur. People commonly use energetic, driven, persistent, and passionate words to characterize entrepreneurs (Stamboulis and Barlas 2014).

Nonetheless, we have reasonable grounds to believe that beneath this impervious exterior lays an unsettling truth: entrepreneurs could also experience fear of failure. Along the way, they might have to deal with worries, such as the dread of losing a client, the anxiety of not being paid, the fear of not landing a contract, the concern of an unmanageable financial flow, and the worry that they will not have enough time to spend with friends, family, and other loved ones. Although it is easy to agree that the feeling of fear of failure is the least discussed chapter in an entrepreneur’s life story, however it is one of the realistic factors in the life of an entrepreneur.

Based on the results of the regression analysis performed for this study, it can be concluded that risk aversion is a significant factor that affects the dependent variable at the 0.001 level; however, given that the beta coefficient is negative, the impact of this factor is negatively associated with entrepreneurship development. This agrees with the findings of other studies that point to a willingness to take risks as an essential quality in successful business owners (Mahola et al. 2019; Aderibigbe et al. 2019). Thus, risk aversion may be a real obstacle to entrepreneurship development.

According to the results of the multiple regression analysis, a lack of resources is a factor that affects the development of entrepreneurship. Its standardized beta coefficient is 0.211, and its t-statistic is significant at (Sig. = 0.000). This result is consistent with past research on small business entrepreneurs that was carried out in the United Arab Emirates (Shahverdi et al. 2018; Thaler et al. 2019). In previous research, a dearth of resources was viewed as the primary factor influencing the growth of entrepreneurship. This survey, which focused on the United Arab Emirates, revealed that Emiratis believe that a lack of resources is a significant factor in an entrepreneur’s success. Like most developing nations’ cultures, this is engrained in theirs. Therefore, the findings of this study indicating the significance of resources in forecasting the development of entrepreneurship in the United Arab Emirates appear to be consistent with other research, putting light on one of the critical factors impacting entrepreneurship. Therefore, a lack of resources might be a roadblock to entrepreneurship. H4 is, consequently, adequately supported.

6. Conclusions

This research provides valuable insight into a developing country’s most critical economic forces: entrepreneurship. The findings of this research can be applied to the design and improvement of programs that encourage business start-ups and growth. This investigation revealed many barriers in the United Arab Emirates that inhibit would-be business owners from diving into entrepreneurial activities. The research findings of this study highlight entrepreneurship development in the UAE and advance research in the field of entrepreneurship in different ways. The research findings advance the knowledge base by exploring and understanding the crucial barriers to entrepreneurship development for various stakeholders. The study results enable regulatory authorities in the UAE to create targeted and effective policies and programs that support and promote entrepreneurship. By identifying and addressing these barriers, policymakers and learning institutions can help remove obstacles to entrepreneurship and create a supportive environment for entrepreneurs. This can lead to increased innovation, job creation, and economic growth, which are all critical goals for any society.

One of the significant factors that inhibit business growth is a deficiency of resources. This finding suggests that people view assets as being critical to the development of their enterprise. Therefore, policymakers should strive to strengthen civil society and its agencies by increasing their visibility and influence and broadening the range of people they serve. Local governments should prioritize networking opportunities by making resources, such as contact details, lists of available and potential services, and information about other entrepreneurs, readily available to budding business owners. This emphasizes the need to establish and sustain policies that may act as a socioeconomic shield and assist entrepreneurs.

As risk aversion was found to stunt the growth of entrepreneurs, policymakers should foster an environment where people are more willing to take calculated risks. This means teaching future business owners how to do so in elementary and secondary schools. The concepts of decision making under risk and uncertainty may be introduced to high school students and expanded upon in college, allowing them to weigh the potential benefits of taking calculated risks. Avoidance of uncertainty is a cultural norm that can only be altered if new generations are taught to be more open to taking risks. It is imperative, therefore, to reexamine educational programs and make the necessary changes to instill risk tolerance in the next generation (Ratten and Usmanij 2021).

The regression analysis shows that these variables are significantly related to the likelihood that a person would focus on entrepreneurship development and launch a new company. Support for the economic growth and development of the country is essential to inspire entrepreneurs to launch a new firm. A conducive business climate for entrepreneurs is one in which the government has a role by encouraging banks to lend money to entrepreneurs and protecting their projects from challenges in external business environment like political situations, civil unrest or wars. The development of new firms may be facilitated if several government departments and organizations collaborate to eliminate barriers to entrepreneurship.

Since this research focuses on small business entrepreneurs, its results should not be extrapolated to the broader public. It becomes clear that the quantitative strategy employed is insufficient to elicit the specifics of the obstacles studied. Future researchers should explore the experiences of small business owners who focus on entrepreneurship development and compare their successes and failures. Further research is needed to learn how aspiring small business owners deal with the various obstacles highlighted here. It would be fascinating to perform an in-depth, qualitative study on the differences in entrepreneurial propensity and perceived impediments between ethnic groups.

Firms in the UAE should be aware of how entrepreneurship helps the economy, including through the development of new jobs, higher output, more market players, more foreign currency, and access to previously untapped customer bases. Training in entrepreneurial skills is beneficial since it promotes problem-solving, goal-setting, and innovative thinking inside a company. It is also crucial for the economy to foster an environment conducive to entrepreneurial endeavors. It results in creating distinctive and high-quality goods, which help businesses succeed in the face of intense competition. Entrepreneurship thrives alongside technological progress because it inspires individuals to think creatively, which boosts productivity. Therefore, it is incumbent upon the UAE government to supply cutting-edge tools that may be used in manufacturing. Individuals in the United Arab Emirates need to be educated on the merits of entrepreneurship to be encouraged to launch and maintain a wide variety of businesses. Competition in the marketplace is so high that opening up new marketplaces where companies may sell their wares is essential.

The current study does not go deeply enough into the factors that foster and hinder entrepreneurial activities in the United Arab Emirates. This study does not shed light on the effects of risk mitigation, and it has merely discussed the risk-mitigating measures that may be followed to ensure the success of entrepreneurship in the UAE. As a result, research on the outcomes of risk-reduction actions is essential. People in the United Arab Emirates (UAE) need better access to entrepreneurship education to learn the managerial and technical skills necessary to start and run their businesses. This would aid in the formation and maintenance of a healthy economy. Entrepreneurs are the lifeblood of any economy; therefore, it is only fair that governments lend a hand to those who are willing and able to launch new businesses. Providing funding to help start businesses is one way to accomplish this goal. The government should foster innovation and originality to ensure that consumers may find and purchase unique and high-quality goods and services. Furthermore, the UAE government must create enough facilities to facilitate domestic entrepreneurship development.