Pixels to Paychecks: Understanding The Determinant of Latent Entrepreneurial Transition in Digital Context

Abstract

In the ever-changing landscape of China’s digital economy, comprehending the transition drivers from latent to active participation in entrepreneurship is critical. This research explores the factors shaping the decisions of latent entrepreneurs to become active entrepreneurs in a digital context. Using simple random sampling, this study randomly selected 18 industries within China’s major cities. This study collected cross-sectional data from 485 respondents in high-tech and low-tech industries across six major Chinese cities and tested the model using partial least structural equation modeling (PLS-SEM). Statistical findings conducted by SmartPLS reveal a nuanced interplay between personal factors and external traits in shaping the transition to active entrepreneurship. In particular, entrepreneurial competence, digital skills and literacy, and adaptability are crucial personal factors influencing this transition. Access to the necessary technology, startup cost, market and customer base, and government support are external traits found to significantly shape individual decisions to venture into digital entrepreneurship. Surprisingly, Logistics and Transportation (LAT) had no substantial impact on the transformation. This investigation strengthens entrepreneurship theory while also providing policymakers and industry actors with practical insights. Personalized training for entrepreneurs, spending on digital infrastructure, evidence-based regulations, and enhanced business innovation initiatives are among the recommendations.