Opportunity-driven Entrepreneurship Research Articles

Understanding family dynamics and entrepreneurship: A grounded theory analysis of opportunity-driven entrepreneurs in Turkey

Understanding family dynamics and entrepreneurship: A grounded theory analysis of opportunity-driven entrepreneurs in Turkey

Exploring entrepreneurial intentions and motivations: a comparative analysis of opportunity-driven and necessity-driven entrepreneurs

This study investigates the impact of entrepreneurial attitudes, subjective norms, and perceived behavioral controls on entrepreneurial intention among two distinct groups of entrepreneurs: opportunity-driven and necessity-driven. It also explores the relationship between entrepreneurial motivations, intentions, and the number of ventures undertaken by entrepreneurs. Structural equation modeling and survey data from 201 necessity-driven entrepreneurs and 204 opportunity-driven entrepreneurs were utilized. Drawing on the Theory of Planned Behavior, the findings indicate that attitudes do not positively correlate with entrepreneurial intention for both types of entrepreneurs. Subjective norms significantly influence entrepreneurial intention among entrepreneurs by necessity but not among entrepreneurs by opportunity. Perceived behavioral controls exhibit a partial correlation with entrepreneurial intention, which is not significant for entrepreneurs by opportunity. Both motivations and entrepreneurial intention positively relate to the number of ventures undertaken by entrepreneurs by necessity, whereas motivations alone determine venture creation among entrepreneurs by opportunity. Furthermore, a significant correlation exists between being a female entrepreneur by necessity and entrepreneurial intention, while this relationship is not significant for women entrepreneurs by opportunity. These insights contribute to the literature on entrepreneurial intention and carry important policy and managerial implications in developing countries.

Quid pro quota: a cross-country study on the impacts of immigration quotas on early-stage entrepreneurship

AbstractWe study the impacts of immigration quotas and immigrant eligibility restrictions on destination countries’ early-stage entrepreneurial activity. Taking advantage of cross-country variation in immigration quotas and eligibility restrictions, we find that increases in the strictness of labor migration quotas and eligibility requirements are associated with significantly less early-stage entrepreneurship in the short run. Further, we find two important sources of heterogeneity that impact our results. First, these results are driven by a connection between quotas and early-stage necessity-driven entrepreneurship—our results lose significance when adding opportunity-driven entrepreneurship to the analysis. Second, the magnitude of the relationship between quotas and early-stage entrepreneurial activity is lower when analyzing female entrepreneurship. Overall, our results suggest that immigrants clearly influence entrepreneurship positively, but the overall welfare effects on the host country of marginal increases in entrepreneurial activity associated with a relaxation of labor market restrictions are more nuanced. At the same time, our results also suggest room for immigration policy to improve the welfare of immigrants and natives. Importantly, our estimates likely act as a lower bound given that we are not able to measure impacts in the long run. Because immigrants’ participation in the labor market is often delayed by labor market restrictions after entry, estimates of the impact of quotas and other restrictions that limit entry into the host country would likely yield more negative results given a longer time horizon.

Government expenditure and entrepreneurial activity: considering the types of entrepreneurial motivations

ABSTRACT As a cross-national study, we analyze the relationship between the functional-level government expenditure and the different types of entrepreneurship, that is, whether it is an opportunity- or necessity-based entrepreneurship. Our analysis of 17 Organization for Economic Cooperation and Development (OECD) nations revealed that government investments in economic affairs are positively related to opportunity-driven entrepreneurship, but negatively to necessity-driven entrepreneurship. On the other hand, government spending on education is positively related to necessity-driven entrepreneurship. Further, we find that larger government expenditure on education in Asian countries encourages more entrepreneurs to start their businesses than the rest of the OECD.

The roles of big businesses and institutions in entrepreneurship: A cross-country panel analysis

This study aims to determine whether big business or institutions comprise a more significant entrepreneurship determinant. In addition, we have three subobjectives: We examine (1) how the relationship between big businesses and entrepreneurship changes according to the economic development stage; (2) if big businesses affect the two different entrepreneurship types, namely, opportunity- and necessity-driven entrepreneurship, differently; and (3) which institutional factors are effective for these two different entrepreneurship types. To this end, we compare the effects of big businesses and institutions on entrepreneurship among 33 countries covering lower-middle-, upper-middle-, and high-income countries during the 2001–2015 period. Among the various determinants of entrepreneurship, we focus on two key factors that affect entrepreneurship, namely, big businesses and institutions while controlling for the demand- and supply-side factors that influence entrepreneurship. This study conducts fixed-effect estimations. We find that the relationship among entrepreneurship, big businesses, and economic development is “N-shaped.” In particular, there is a positive relationship between big businesses and opportunity-driven entrepreneurship in high-income countries. Moreover, among the various institutional factors, only supportive public policies toward new firms and positive social perceptions toward entrepreneurs are effective for opportunity-driven entrepreneurs, whereas none of the institutional factors are effective for necessity-driven entrepreneurs.

The role of digitalization in decreasing gender gap in opportunity driven entrepreneurship

ABSTRACT Women entrepreneurs are a promising yet under-supported group that have notable impacts on the economy. Recent societal attempts to empower female entrepreneurs and their critical role in economic development have motivated research on determinants of women’s participation in entrepreneurship and what can reduce gender disparities in this field. Drawing on insights from information economics, this paper emphasizes the recent transformations through digital technologies and examines the effect of digital readiness of an economy on women’s ability to close the gap on entrepreneurial activities. Using a sample of international observations over the 2010–2016 period, we show that the capability of an economy to exploit digital opportunities increases female participation in opportunity-driven entrepreneurship. The results also indicate that the positive role of digital readiness in women’s entrepreneurship strengthens in populations with higher perceived opportunity and, more interestingly, higher fear of failure.

Conditions that make ventures thrive: from individual entrepreneur to innovation impact

Entrepreneurship and innovation create a positive impact on the economy and society. Globally, governments invest resources to support new ventures and facilitate innovation. In this study, we examine this phenomenon by studying the pathway that goes from individual entrepreneur to innovation impact. We measure the effect of entrepreneurial motives on different types of innovations, with a particular focus on its amplification by formal and informal institutional conditions. Specifically, we use multi-level models to analyze annual data of 29 countries for 2006 to 2018. We find that opportunity-driven entrepreneurs are associated with higher levels of radical innovation, breakthrough innovation, and disruptive innovation. Better tax policies and less bureaucracy amplify this positive effect on radical innovation and breakthrough innovation. For necessity-driven entrepreneurs, the regulatory quality amplifies the positive effect on radical innovation and disruptive innovation, while monetary resources dampen this effect. Our findings show that the differences in innovation impact can be explained by differences in entrepreneurial motives and their specific interactions with formal and informal institutional conditions.

Social Capital and Self-Employment Dynamics in China

Opportunity-driven entrepreneurship can stimulate economic growth and foster technology innovation, while subsistence-driven self-employment can have the opposite effect. In China, a country with a typical relational society and a middle-income status, the nature of nonagricultural self-employment remains contentious. Examining the influence of social capital on entrepreneurial activities can provide insight into the nature of entrepreneurial activities in China, although this issue has received relatively little attention in the literature. To address this gap, this study employs multivariate discrete choice modeling on national representative samples from the China Family Panel Studies dataset to assess the relationship between social capital and entrepreneurship dynamics. The results indicate that relational, structural, and cognitive social capital all affect entrepreneurial dynamics, and these effects vary between urban and rural areas. Individuals who are less likely to be members of an organization, who are less conscientious, and who have low levels of trust and gift expenses are more likely to become self-employed. Conversely, people with high trust, strong conscientiousness, and low social status are more likely to exit self-employment. In addition, individuals with lower levels of human capital are more likely to both enter and exit self-employment. These findings suggest that self-employment tends to be subsistence-driven in China, which has implications for policymakers seeking to promote opportunity-driven entrepreneurial activities.

Do Tax Rates Matter for Entrepreneurial Motivations? An Empirical Approach

There are a number of factors that can hinder the path of entrepreneurship development and the literature highlighted the fact that taxes are one of the most important barriers for entrepreneurs. This paper aims at identifying the relationship between tax rates and entrepreneurship and to establish the impact of tax rates on entrepreneurs considering their motivations (necessity, opportunity or improvement-driven opportunity). The research focuses on a sample of 46 countries grouped according to their income level, for a period of eight years (2012-2019). In order to test our hypotheses, we use multiple linear regression based on balanced panel data and we consider, as dependent variables, indicators that measure entrepreneurship and entrepreneurial motivations (early-stage entrepreneurial activity, necessity-driven entrepreneurs, opportunity-driven entrepreneurs, improvement-driven opportunity entrepreneurs, and motivational index). As independent variables, we consider indicators that measure the tax rates supported by entrepreneurs (total tax and contribution rate, profit tax, labor tax and contributions, and other taxes payable by businesses). The results show that tax rates play a key role in fostering the creation of new companies. Moreover, the impact is different, depending on the entrepreneurs’ motivations. Entrepreneurs motivated by necessity are positively related to total tax and contribution rate, while those motivated by opportunity are negatively related with this indicator. Therefore, tax rates discourage the entrepreneurs that seek innovation, but they do not affect those that do not have other options to obtain the necessary income for living.

Do survivalists deserve to be called entrepreneurs? The case of hospitality micro-entrepreneurs in Indonesia

Studies in entrepreneurship do not classify survivalists as ‘true’ entrepreneurs because they lack ‘essential’ entrepreneurship characteristics such as an orientation towards innovation and growth. Thus, survivalists are perceived as lesser entrepreneurs or the poorer cousins of opportunity-driven entrepreneurs. This study re-evaluates this perception by focusing on street food vendors because even though they play a significant role in the hospitality industry in many countries, they are often neglected in the hospitality sector and associated academic research. Online, unstructured interviews were conducted with 25 street food vendors in Bandung, Indonesia, and the data were analysed using thematic analysis. The findings revealed that street food vendors (i.e. survivalists) possess a variety of entrepreneurial characteristics, including achievement orientation, seizing business opportunities, risk-taking behaviour, innovativeness and efficient resource utilization. Thus, it is argued that they deserve to be recognized as entrepreneurs as well.

Explaining the Positioning of Agricultural Entrepreneurs on the Necessity-Opportunity Continuum in Sub-Saharan Africa: Insights from Benin

ABSTRACT Despite the potential of agriculture to reduce unemployment in sub-Saharan Africa, research on agricultural entrepreneurship is scarce, especially regarding the entrepreneurs’ motivations. The aim of this research is to examine the intensity of necessity and opportunity motivations among agricultural entrepreneurs and the influence of socioeconomic characteristics, personality, and environmental factors. Hence, the study reports a survey of 819 agricultural entrepreneurs in Benin and uses multinomial logistic regressions. Most agricultural entrepreneurs are moderately necessity-driven (76%); the remainder includes highly necessity-driven entrepreneurs (4%), moderately opportunity-driven entrepreneurs (6%), and highly opportunity-driven entrepreneurs (14%). Those displaying higher intensity of necessity motivations can be at any education level, are former employees, are less proactive, less optimistic, and operate in the services sector. In contrast, highly opportunity-driven entrepreneurs are likely to have received a university education and agricultural professional training, operate in the services sector, and have better access to finance and technologies. This study advances the push-pull theory by revealing a richer set of entrepreneurial motivations beyond the simplistic dichotomic view. Hence, policymakers could devise entrepreneurship strategies and programs that consider the diverse motivations of entrepreneurs and the influencing factors to move them toward increased opportunity entrepreneurship.

Sustainable entrepreneurship out of entrepreneurial opportunity identification: The mediating role of psychological capital.

The aim of the present study, was to examine the simultaneous effects of entrepreneurial opportunity identification (EOI) and psychological capital (PC) on university students' entrepreneurial intention (EI). Compared with necessity-driven entrepreneurship, opportunity-driven entrepreneurship is more sustainable. Scholars have shown that EOI is key to forming EI, but little has been discussed about its association with PC. A total of 555 university students in China were enrolled by means of convenience sampling. Descriptive statistics and correlation analysis of variables were performed using SPSS 21.0 software. Structural equation modeling analysis (SEM) with AMOS 21.0 was used to examine the structural effects of EOI and PC on university students' EI. According to the results, university students' EOI and PC had a positive and insignificant influence on their levels of EI. Furthermore, PC was found to fully mediate the impact of EOI on EI. The present study could shed light on new instructions to examine the interaction between the cognitive and psychological components of EI in the field of entrepreneurship. It is recommended that educators and practitioners should pay regard to the role of EOI and PC.

Entrepreneurial fear of failure and well-being of incubated and non-incubated startups during crises

Purpose The phenomenon of fear and anxiety can cause a decline in entrepreneurship. However, the validity of this assertion remains debatable, as opportunity-driven entrepreneurs may benefit from elevated uncertainty during a crisis. This study aims to examine entrepreneurial fear of failure and the well-being of opportunity-driven entrepreneurs in their startup stage during the COVID-19 outbreak. Opportunity-driven startups are oriented toward business growth but may need assistance from incubators. Design/methodology/approach The study used a qualitative method, where ten participants from incubated and non-incubated startups in Indonesia were interviewed. Thematic analysis was conducted using NVivo 12 software to analyze the data. Findings This study shows that the interviewees subjected to incubation tended to derive motivation from fear of failure. In contrast, nonincubated interviewees showed a propensity to experience fear of failure as repression and inhibition. Furthermore, the study highlights the correlation between entrepreneurial fear of failure and eudaimonic well-being. Originality/value This study contributes to the literature with empirical results on fear of failure capturing the essence of entrepreneurial behavior during crises/pandemic in the context of business startups. It provides valuable insights into the policy implications for promoting innovation among startups in specific contexts.

Socio-economic causals for entrepreneurial transformation

Entrepreneurship has become vital for national growth. Therefore, it is essential to explore the factors that enhance entrepreneurial transformation. The literature identifies two main driving forces behind entrepreneurship: necessity and opportunity, which react differently to the socio-economic factors. This study explores the socio-economic determinants of necessity-based entrepreneurship and opportunity-based entrepreneurship. Here the yearly data of 108 countries from 2009 to 2017 is used to formulate a panel data model. Data on entrepreneurship is taken from the Global Entrepreneurship Monitor (GEM). HDI is used as a surrogate measure of socio-economic factors along with several control variables like cost of doing business, economic factors, governance factors and perception factors. Panel Feasible Generalized Least Squares (FGLS) estimation technique accounts for spatial heterogeneity. The panel data estimation shows that human capital improvement enhances the opportunities for entrepreneurial transformation while decreasing necessity-based entrepreneurship due to higher job creation. The findings also suggest that improvement in governance, perceived opportunities, openness, and culture are vital for enhancing opportunity-driven entrepreneurship.

Entrepreneurial education and opportunity entrepreneurship: the mediation of self-efficacy belief

This paper studies the mediating role of self-efficacy belief in explaining the effect of entrepreneurial education on opportunity-driven entrepreneurship. The influence of education on entrepreneurship is a top concern of both researchers and policymakers, who often struggle to understand how this influence occurs. Looking through the theoretical lens of the theory of planned behaviour (TPB), this study contributes to a better understanding of the nomological network of opportunity-driven entrepreneurship. Data from the 2016 Global Entrepreneurship Monitor (GEM) survey yielding a sample of 1,008 entrepreneurs from various Spanish regions with diverse levels of development were used. The results of this study show that self-efficacy belief represents the generative mechanism by which entrepreneurial education influences opportunity-driven entrepreneurship. Furthermore, the results provide evidence of the importance of supporting entrepreneurship education. Policymakers should be focused on reinforcing those skills and competencies that increase self-efficacy belief, enable the individual capability for action and provide a better understanding of business opportunities in the contemporary environment.

The impact of housing price on entrepreneurship in Chinese cities: Does the start-up motivation matter?

Until recently, studies of the driving forces and determinant factors of entrepreneurial entry and the emerging literature on the housing-entrepreneurship nexus have been developing independently of each other. This study attempts to connect these two strands of literature through an examination of the impact of urban housing price on the self-employment choices of urban individuals driven by different start-up motives in urban China. Drawing upon a sample of urban individuals developed from the 2016 China Labor-force dynamics data, this study finds that a high level of urban housing price exerts a significantly negative impact on urban individuals' propensity to engage in necessity-driven entrepreneurship, but exhibits no significant influence on opportunity-driven entrepreneurship. The negative consequence of high housing price is most pronounced for necessity-driven entrepreneurs who are not home owners. This study proposes the incorporation of start-up motivation in public policy support for entrepreneurship.

Entrepreneurship and unemployment nexus in MENA: Does institutional quality matter?

Entrepreneurship has been identified as a panacea to abating the rising unemployment rate in MENA. However, the region’s institutional quality could influence whether entrepreneurship would generate/stall employment. Thus, we examined the role of institutional quality in the entrepreneurship-unemployment nexus for seven MENA countries using the dynamic ordinary least square method to analyse data covering the period, 2006-2019. The results show that opportunity-driven entrepreneurship and total-early-stage entrepreneurship have the potential to reduce unemployment while institutional quality seems to augment the unemployment-reducing effect of entrepreneurship. This implies that promoting entrepreneurship and strengthening the institutional apparatuses in the MENA region should be prioritised.

Gender inequality and the entrepreneurial gender gap: Evidence from 97 countries (2006–2017)

Although it seems almost a stylized fact that females are less likely than males to start new ventures, closing this gender gap is essential to foster sustainable economic growth. In this study, we analyze whether gender inequality, as measured at the country level by the World Economic Forum since 2006, is associated with the gender gap in entrepreneurship. By analyzing country-level information about gender inequality (97 countries) in combination with individual-level data from the Global Entrepreneurship Monitor (1,905,665 individuals) from the years 2006 to 2017, we find that in more gender equal countries involvement in total early-stage entrepreneurial activity (TEA) is higher. Gender inequality moderates the effect of gender on TEA, by almost closing the gender gap in entrepreneurship in the most gender equal countries. We show that gender inequalities in economic participation and opportunity as well as in political empowerment are the main drivers of this interaction effect. We find similar patterns when distinguishing between opportunity-driven and necessity-driven TEA. With opportunity-driven entrepreneurship as a potential vehicle for the economic empowerment of females, our study highlights the role of policies stimulating gender equality.

Entrepreneurial Well-being: An Exploratory Study for Positive Entrepreneurship

Abstract Given the limited studies in the literature to understand entrepreneurial well-being, in this study, we aimed to answer the questions “what kind of resources does an entrepreneur need to experience a high level of well-being?” and “what would be the possible consequences of an entrepreneur’s well-being?” To elaborate the entrepreneurial well-being concept further, we conducted in-depth interviews with 20 male, married, and opportunity-driven entrepreneurs operating technology enterprises in Turkey. Based on the thematic analysis of the interviews, we ended up with six resources for their well-being (i.e., individual factors, family life, entrepreneurial success, network, the team, and investment) and five areas on which their well-being is impactful (i.e., individual, family, societal, employees, and business). Despite its limitations, our study contributes significantly to entrepreneurial well-being literature and paves the way for further research.

Do foreign investment and economic freedom matter for behavioral entrepreneurship? Comparing opportunity versus necessity entrepreneurs

This paper provides new evidence on how outward and inward foreign direct investment (FDI) and economic freedom influence opportunity and necessity entrepreneurship in emerging markets. Studying 38 emerging economies, the empirical results show that both types of FDI exert opposite spillover effects on opportunity and necessity entrepreneurship and that greater economic freedom increases inward FDI and reduces outward FDI, thereby enhancing entrepreneurial activities. Additional analysis shows that the influence of FDI on entrepreneurship development depends on the dimensions of economic freedom. In particular, better economic freedom allows FDI to increase opportunity-driven entrepreneurship and decreases necessity-driven entrepreneurship. Policy and practical implications are also discussed.