Abstract
This is a literature review consisting of an analysis of previous studies on International Entrepreneurship and Economic Development. International entrepreneurship was initially used to refer to the method in which technical advancements and cultural knowledge enabled new companies to enter previously unexplored overseas markets. It entails creative and inventive operations that span international boundaries with the goal of generating value and development for business enterprises. As being such, it pertains to a firm’s creative operations conducted beyond boundaries. Innovative also contains the merit component, as enterprises go beyond their own nation in search of fresh chances in untapped or uncharted markets. Various studies have been conducted by different researchers on the same.
Introduction
The studies reviewed will relate to International Entrepreneurship and Economic Development. McDougall and Oviatt define international entrepreneurship as “a mix of inventive, proactive, and risk-taking conduct that spans national boundaries and is meant to provide value to businesses.” International entrepreneurship is the practice of starting a firm in a different country. In this list, you’ll find companies that operate beyond borders.”
This kind of entrepreneurship involves exporting items, obtaining licenses, and setting up a dealership in another nation. An entrepreneur’s business activities extend beyond the limits of a single country, showing that the company has gone global. Increasing the company’s worth and growth is a common goal for most businesses. Innovative measures taken by the majority of companies across boundaries that increase their ability to provide distinctive products and services. An international entrepreneur describes the process by which a new firm is formed on a global scale and their operational area is considered international from the beginning (International Entrepreneurship: Meaning and Opportunities, 2021).
On the other hand, economic development is the process by which low-income, unsophisticated country economies become contemporary industrial economies. Although the terms “economic growth” and “economic transformation” are frequently used interchangeably, the latter refers to a country’s economic transformation that includes both qualitative and quantitative improvements. An economic development theory that explains how primitive and destitute economies might transform into sophisticated and moderately wealthy ones is essential for developing countries, and economic development problems are often argued in this context. (Economic development, 2021). After WWII, economic development became a key priority. After the end of European colonialism, many former colonies and poor countries were labeled as underdeveloped, compared to developed countries like Canada, the US, Western Europe, much of Eastern Europe, the USSR, Japan, New Zealand, Australia, and South Africa. As the living conditions of most impoverished nations improved, they were called developing countries.
International Entrepreneurship and Economic Development
According to Sanyang and Huang, (2019), the premise that entrepreneurship is associated with economic development is founded on basic intuition, common sense, and purely economic observation: actions aimed at converting ideas into economic possibilities are at the core of entrepreneurship. Entrepreneurship fosters innovation and change, hence boosting economic competitiveness and productivity. Entrepreneurs have been a central figure in the majority of production, distribution, and growth theories.
Entrepreneurship’s function as the engine of economic progress found its most obvious expression. Empretec was founded in 1988 with the aim of fostering entrepreneurialism in underdeveloped nations. Empretec’s initiatives have been launched in 27 countries, with more centres in Brazil, aiding over 80 entrepreneurs via community-based business support centres. The material for this research was gathered from secondary sources rather than through a survey. As such, one of the paper’s aims is to investigate the precise nature of entrepreneurship and its significance in economic theory (Sanyang and Huang, 2019).
Toward a Theory of SME Internationalization Through International Entrepreneurship
Smolarski and Kut’s (2019) study on small and medium-sized companies (SME) showed that the SMEs are deficient in a suitable analytical framework for interpreting contemporary international activities. There are two types of internationalization theories: those that focus on economics and those that focus on the development of businesses beyond borders. Small businesses’ internationalization initiatives cannot be supported by them, though. SME internationalization processes are neither path-dependent, emerging, or gradual, according to contemporary empirical research.
Despite this, modern SME researchers continue to use stage models, learning-based stage models, or network methodologies to characterize SME behavior patterns. “backsourcers,” “born regionals,” and “born globals” are all examples of phenomena that cannot be explained by non-continuous stage models, such as “born globals,” “instant internationals,” and “backsourcers,” which are traditional SMEs that enter the international market or operate successfully in foreign countries. In light of this, it’s clear that internationalization concepts need to be refined further (Smolarski and Kut, 2019).
Transnational Corporations as International Entrepreneurship Enterprises
Congruent to Eshun (2017), the wide and varied activities of transnational corporations (TNCs), the fast expansion of their capital, and their centralization of major industries and contexts of economic activity all contribute to a greater increase in the impact of TNCs on the qualitative and quantitative parameters of the functioning of the world economy.
As a result, the effect of their bankruptcy on multiple sectors of the global economy at the same time as well as the distinctive mechanism of its inception, development, prevention and overcoming are all highlighted (Eshun, 2017). Objective circumstances for the proper operation of the market mechanism are among the top goals of corporate management, which includes improving both the techniques of performing business practices and the methods of economic and financial analysis of multinational corporations.
International Entrepreneurship by Individuals ‘on their own terms’: A Study of the Common Traits of Entrepreneurs in Developing Economies
As reported by Nkongolo Bakenda, Anderson, Jafari Sadeghi and Biancone (2019), the construction of new firms has led to the integration of local people in various locations into value creation which is regarded as an entrepreneurial behaviour that fosters internationalization. Understanding the universal determinants for international entrepreneurial success and direction is the goal of this research, which draws on internationalization theories and regulatory theories. International Entrepreneurship is influenced by factors such as education, family income, and gender, however there was no evidence to support the impact of age categories. As a result, they utilized a binomial logistic regression model that contained data from growing countries including Iran, Italy and Canada.
Entrepreneurship on a Global Scale in Resource-rich Landlocked African Nations
In line with Dana and Ratten (2017), despite the growing body of study on international entrepreneurship, little is known about the procedure in Africa. This is because there is a disconnect between the reality of African entrepreneurs’ business initiatives and worldwide views about African entrepreneurs. As a consequence of the continent’s variety, the structure of international entrepreneurship differs according to historical and cultural background.
For this reason, they illustrate how African attitudes on international enterprise differ from those of Europe and North America. A set of research proposals for resource-rich landlocked African states (Botswana, Zimbabwe, and Zambia) with diverse approaches to international entrepreneurship is constructed in this manner. To do this African countries wealthy in natural resources should focus on their cultural qualities and informal networks to stand out in the global economy, according to research suggestions (Dana and Ratten, 2017). Management and theoretical research proposals for separating landlocked African states from resource-scarce coastal countries are discussed in this article.
A Systematic Review of Special Issue Articles on International Entrepreneurship
According to Perényi and Losoncz (2018), an examination of the existing body of knowledge on international entrepreneurship was carried out in order to identify key trends, research orientations and emerging research issues. As a starting point, we looked at 21 systematic and six non-systematic reviews published between 1998 and 2018. Examining the trends and directions of development of these 27 published papers gives a framework for analyzing the research. Accordingly, 126 special issue papers were examined using these criteria to evaluate the breadth and depth of international research in entrepreneurship feature articles and verify the essential subjects and directions for international research.
International business and entrepreneurial studies, focus on SME internationalization, and various sorts of international new firms and born globals are all trends. Comparative entrepreneurship and internationalization have developed as research themes in recent years, underscoring the crucial need of integrating empirical data across countries and contexts. A lack of expertise in emerging and transitioning country situations is evident. There is also more room for comparative research, which might lead to the creation and application of context-specific theories, thereby paving the way for international entrepreneurship researchers (Perényi and Losoncz, 2018).
International entrepreneurship from an institution-based perspective: A comparison of context-specific and universal factors in developing and economically advanced nations
Jafari Sadeghi, Nkongolo-Bakenda, Anderson and Dana, (2019) conducted a study to examine the institutional features of various geographic settings that influence small and medium-sized firms’ internationalization (SMEs). The research examined three distinct kinds of factors: social, political/legal, and economic. It investigates competitive challenges in international marketplaces, the nature of foreign market demand, domestic resource advantages, and local general economic features under economic variables. The article discusses common elements affecting the internationalization of SMEs independent of their geographical location. These universal elements are separated from context-specific ones, which were unique to the people or location of the company. Comparing instances from Italy and Iran enables them to identify universal characteristics, Iranian context-specific factors, and an Italian context-specific factor. Additionally, their study indicated the presence of several variables that have no discernible effect in either nation.
Can policymakers rely on entrepreneurship’s good influence on the economic growth of Czech regions?
According to Dvouletý (2017), an investigation of the impact of new entrepreneurial activity on economic development in Czech NUTS 3 areas from 2003 to 2015 was an objective of this study. An econometric approach was used to verify the hypotheses, which anticipated a positive correlation between new entrepreneurial behavior and regional economic growth and a negative correlation between new entrepreneurial behaviour and the rate of unemployment. A panel of 13 Czech areas was used to produce multiple regressions using a fixed-effect model from 2003 to 2015. Business companies and partnership establishments were split into two categories: the rate of newly founded self-employed enterprises per population. It has also been shown that self-employment and the establishment of new firms have a varied influence on the GDP per capita of the country. The number of new self-employed establishments had no influence on economic growth in the Czech regions, only the number of new firms and partnerships. There is little doubt that both new entrepreneurship and new commercial activity have a positive impact on unemployment rates in the Czech Republic, but the impact of new commercial activity is significantly bigger. Several policy implications of the results are discussed in this article. Supporting entrepreneurship in Czech areas has the potential to strengthen local labour markets and provide new employment possibilities via newly founded businesses. Czech entrepreneurship policies, which are geared at GDP development and economic expansion, should place a greater emphasis on supporting high-growth firms (unicorns). The empirical study was undertaken in order to fill a knowledge gap regarding the influence of newly developed entrepreneurial behaviour on the economic growth of Czech regions (Dvouletý, 2017). The obtained findings have had a number of policy consequences, which are described in this article.
Conclusion
Following the primary findings of the studies, entrepreneurship is very crucial for economic growth and stability, with the role of government policies, a country’s economic development stage, and entrepreneurial behaviour all playing a role in these outcomes. The level of GDP seems to be constrained by the behavioural component; nevertheless, an educational system that promotes entrepreneurial activity has the potential to have a good impact on the development of entrepreneurship in nations, as well as on the achievement of long-term economic growth.
References
Dana, L. and Ratten, V., 2017. International entrepreneurship in resource-rich landlocked African countries. Journal of International Entrepreneurship, 15(4), pp.416-435.
Dvouletý, O., 2017. Can policy makers count with positive impact of entrepreneurship on economic development of the Czech regions?. Journal of Entrepreneurship in Emerging Economies, 9(3), pp.286-299.
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Eshun, J., 2017. From political independence to economic emancipation: reseeding Africa with entrepreneurship and institutions to accelerate economic development. Transnational Corporations Review, 10(3), pp.244-261.
Jafari Sadeghi, V., Nkongolo-Bakenda, J., Anderson, R. and Dana, L., 2019. An institution-based view of international entrepreneurship: A comparison of context-based and universal determinants in developing and economically advanced countries. International Business Review, 28(6), p.101588.
Nkongolo Bakenda, J., Anderson, R., Jafari Sadeghi, V. and Biancone, P., 2019. International entrepreneurship by particular people ‘on their own terms’: a study on the universal characteristics of entrepreneurs in evolving economies. International Journal of Entrepreneurship and Small Business, 37(2), p.288.
Perényi, Á. and Losoncz, M., 2018. A Systematic Review of International Entrepreneurship Special Issue Articles. Sustainability, 10(10), p.3476.
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Smolarski, J. and Kut, C., 2019. The impact of venture capital financing method on SME performance and internationalization. International Entrepreneurship and Management Journal, 7(1), pp.39-55.
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