Abstract
A vital component for sustainable economic development is the entrepreneurship regardless of the social, geopolitical, and economic situations. However, it is an intimidating challenge to develop and maintain productive small and medium enterprises (SMEs). This article investigates the role of entrepreneurial self-efficacy (ESE) and institutional environment in entrepreneurial orientation and the development of a successful entrepreneurship-based SME. It integrates the institutional climate, self-efficacy, and theory of planned behavior to address the abovementioned challenge in the context of the Kingdom of Saudi Arabia. This study adopts an instrument to collect data from Saudi SME owners and employs SPSS Amos to analyze the proposed moderated mediation model. The outcomes of this study identify the contribution of ESE and institutional environment in the productiveness of an effective entrepreneurship-based SME.
Highlights
The literature on the entrepreneurship practices in small and medium enterprises (SMEs) provides a significant foundation and potential for research and theoretical background in Saudi Arabia (Alfawaz et al, 2014)
The results suggest that the institutional environment moderates the relationship between entrepreneurial self-efficacy (ESE) and SME development, such that better institutional support may increase the impact of ESE on SME development in the Kingdom of Saudi Arabia (KSA)
Entrepreneurship is the result of settled human components that allow creating, identifying, and exploiting the market opportunities linked with the incremental development
Summary
The literature on the entrepreneurship practices in small and medium enterprises (SMEs) provides a significant foundation and potential for research and theoretical background in Saudi Arabia (Alfawaz et al, 2014). 371), “People judge their capacity for challenging activities more in terms of their perceptions of the knowledge, skills, and strategies they have at their command than solely in terms of how much they will exert themselves.” Consistent with this argument, this study assumes that entrepreneurial intentions are, at least in part, a function of the entrepreneurs’ self-efficacy. Entrepreneurship is “the process by which individuals—either on their own or inside organizations—pursue opportunities” or “future situations that are both desirable and feasible.” Thereby, this process requires the mobilization of resources and the pursuit of entrepreneurial initiatives simultaneously (Korsgaard et al, 2016). The dilemma is how entrepreneurs deal with resource constraints, mainly focusing on formal and informal institutions In this regard, gauging entrepreneurship through the lens of resourcefulness, in a country like KSA, enriched with plenteous resources, is an area of investigation
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