Journal of Entrepreneurship Education (Print ISSN: 1098-8394; Online ISSN: 1528-2651)


The Determining Factors of Economic Transformation that Affects the Intention to Leave Business: Analytical Study of Entrepreneurship in Rural Farmers in Indonesia

Author(s): Nuriah Yuliati, Endang Siti Rahayu, Kusnandar, Teguh Soedarto

This research aims to find the factors that influence the economic transformation of farmer households and the influence of the economic transformation of farmers toward farmers’ intention to leave their business in the agricultural sector. The population of this research is farmers with non-agricultural double-income that reflects the transformation process. The sampling technique is using multistage sampling method that is conducted in eight villages in Bangil Sub-District, Pasuruan Regency, East Java, Indonesia. The number of sample is 60 farmer household per village, so the total number of the sample is 360 in 6 villages. The data collection technique is using questionnaire and interview with the key informant. The secondary data is collected from field note that is complementary. The data analysis technique is using Warp PLS version 5.0. The research result explains that the economy, social, self-modernization, and participation factors in development have a positive influence toward the economic transformation of farmers. While the factor of farmers characteristic has a negative influence toward economic transformation of farmers. The interesting finding is that cultural factor does not affect the economic transformation, which means that there has been an easing of the internalization of the farming community towards individuals in economic transformation. In addition, it is found that the economic transformation in farmer households has an influence toward farmers’ intention to leave agricultural sector. The theory implication that can be given is the economic transformation model can be strengthen by strengthening the economic, social, self-modernization, and participation aspects in development. While the managerial implication can be done by giving education policy to partner as producer, consumer, and entrepreneur in agricultural sector by focusing in the economic, social, self-modernization, and participation consideration. Government needs to control farmers to reduce their intention to leave the business sector, especially agricultural, with many efforts, such as education through training and intensive mentoring in agriculture, technological, and business field.