Institutions and international entrepreneurship: the role of regulatory, normative and cognitive congruence

Abstract

In this article, we address the impacts of institutions (regulatory, normative and cognitive) on the country-aggregate propensity to engage in export-oriented entrepreneurship. Using a panel-data of 88 countries from 2006 to 2017, we estimated the direct and moderate effects of institutions on international entrepreneurship. Although a positive institutional environment effect on international entrepreneurial activity has been observed, the nature of this effect is not consistent across models and is especially concentrated in developed economies. These findings provide insights into the complexity of institutional conditions and their impacts on export-oriented entrepreneurship. Through a multidimensional approach, our research offers novel evidence in the context of entrepreneurial internationalisation by analysing the ‘institutional congruence’ hypothesis in the context of international entrepreneurship as an outcome. Indeed, we observed the lack of association between some institutional conditions and export-oriented entrepreneurship in developing economies. Key implications emerged regarding how to improve regulatory, cognitive and normative conditions in business environments by considering the notion of institutional alignment (a central issue in integrating Global Value Chains).