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Speed of pro-market reforms and entrepreneurial innovation

Author

Listed:
  • Lucio Fuentelsaz

    (Universidad de Zaragoza)

  • Consuelo González

    (Universidad de Zaragoza)

  • Minerva González

    (Universidad de Zaragoza)

Abstract

This paper examines how pro-market reforms affect entrepreneurial innovation through the lens of the dynamic institution-based view of the firm. We propose that the speed at which changes occur has a positive influence on entrepreneurial innovation. Additionally, we hypothesize that, in highly uncertain environments, entrepreneurs with higher levels of entrepreneurial self-efficacy and those who have recently entered the market are better equipped to respond in terms of innovation. To test our hypotheses, we conduct a multilevel, cross-country analysis using data from the Global Entrepreneurship Monitor for the period 2009–2018, focusing on individual-level measures of entrepreneurial behavior. Our findings largely support our hypotheses, indicating that a high speed of pro-market reforms has a positive effect on entrepreneurial innovation. Furthermore, this relationship is partially mediated by entrepreneurial self-efficacy and is more pronounced among new entrepreneurs compared to established ones.

Suggested Citation

  • Lucio Fuentelsaz & Consuelo González & Minerva González, 2025. "Speed of pro-market reforms and entrepreneurial innovation," Small Business Economics, Springer, vol. 64(4), pages 1849-1876, April.
    • Handle: RePEc:kap:sbusec:v:64:y:2025:i:4:d:10.1007_s11187-024-00980-6
    DOI: 10.1007/s11187-024-00980-6
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    More about this item

    Keywords

    Entrepreneurial innovation; Speed of pro-market reforms; Institutional change; GEM; Entrepreneurial strategy;
    All these keywords.

    JEL classification:

    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship

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