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

Hatem Afi, Sabri Boubaker and Anis Omri ()
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Hatem Afi: Qassim University [Kingdom of Saudi Arabia]

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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.

Keywords: comparative study; Economic and social effects; Economic freedom; Economics; Emerging economies; Emerging markets; entrepreneur; Entrepreneurial activity; financial market; foreign direct investment; Foreign direct investments; Foreign investment; Investments; Inward and outward FDI; Inward and outward foreign direct investment; Necessity entrepreneurship; Opportunity entrepreneurship; spillover effect; Spillover effects (search for similar items in EconPapers)
Date: 2022
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Published in Technological Forecasting and Social Change, 2022, 181, ⟨10.1016/j.techfore.2022.121761⟩

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Journal Article: Do foreign investment and economic freedom matter for behavioral entrepreneurship? Comparing opportunity versus necessity entrepreneurs (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-04452660

DOI: 10.1016/j.techfore.2022.121761

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