Effect of Herding Factor on Investment Decisions among Small and Micro Enterprises in Nairobi County, Kenya

Abstract

This study sought to determine the effect of herd factors on investment decisions among small and micro enterprises in Nairobi County. The study was premised on the behavioural portfolio. Positivism paradigm was deployed. The study adopts explanatory research design. The target population were 102,821 firm owners. A sample of 383 respondents was selected using stratified random sampling technique. The collected data were analysed using descriptive and inferential statistics. Linear regression models were used to establish the relationship between herd factors and investment decisions. The findings revealed that herding factors was found to have positive influence on investment decision (P = 0.450 < 0.05). The study recommends that firms should improve on herd factors which improved investment. This would enhance better decision investment decision improving financial performance of the SMEs.