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Do Foreign Investment and Economic Freedom Matter for Behavioral Entrepreneurship? Comparing Opportunity versus Necessity Entrepreneurs

Author

Listed:
  • Hatem Afi

    (Qassim University [Kingdom of Saudi Arabia])

  • S. Boubaker

    (Métis Lab EM Normandie - EM Normandie - École de Management de Normandie)

  • A. Omri

    (Qassim University [Kingdom of Saudi Arabia])

Abstract

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. \textcopyright 2022 Elsevier Inc.

Suggested Citation

  • Hatem Afi & S. Boubaker & A. Omri, 2022. "Do Foreign Investment and Economic Freedom Matter for Behavioral Entrepreneurship? Comparing Opportunity versus Necessity Entrepreneurs," Post-Print hal-04452660, HAL.
    • Handle: RePEc:hal:journl:hal-04452660
    DOI: 10.1016/j.techfore.2022.121761
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