The Impact of Institutional Factors on the Rate of International Entrepreneurship in Developing Countries

Document Type : Research Paper

Authors

1 Associate Professor, Faculty of Entrepreneurship, University of Tehran

2 Assistant Professor, Faculty of Entrepreneurship, University of Tehran

3 Master student of Entrepreneurship, University of Tehran

Abstract

International business development is important for economic growth and development. Therefore, in the one hand, early-stage entrepreneurs enter into the foreign markets, which according to the institutional theory, is one of the main institutions in internationalization of entrepreneurship On the other hand, the weakness of institutions can be compensated by organizational mechanisms. Concerning the weakness of institutions in developing countries, this research aims to study the impact of institutional factors on the internationalization of early-stage entrepreneurs in developing economies by considering the interaction between institutions and risk taking as an organizational mechanism. This research is applied in terms of goal, and descriptive-correlational in terms of data gathering. For this purpose, secondary data are used and data for 59 developing countries are collected from international reports which present economic and entrepreneurial indices of countries based on survey data. Data are modeled using structural equation approach by SmartPLS3 software. Results indicate that the rate of international entrepreneurship is positively affected by conducive institutions. In addition, findings of this study show that in the countries where entrepreneurs are more risk taking, the impacts of regulatory and cognitive institutions on international entrepreneurship are negatively moderated

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References

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Journal of Entrepreneurship Development
Volume 10, Issue 2 - Serial Number 36
September 2017
Pages 339-358

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