The Impact of Institutional Arrangements on Entrepreneurial Recovery during the GFC

Abstract

During the global financial crisis, nearly all countries experienced a sharp drop in the rate of entrepreneurship – an entrepreneurial crisis. Using a sample of 56 countries, we employed a fuzzy-set Qualitative Comparative Analysis to investigate the relationship between distinct configurations of institutional arrangements and countries’ recovery from entrepreneurial crisis. Our findings indicate that there is an equifinality in countries’ recovery in which either formal institutions (regulatory) or informal institutions (normative and cognitive) are sufficient conditions for entrepreneurial recovery indicating multiple paths for countries to pursue after an entrepreneurial crisis. More fine-grained findings and implications are discussed.