Empowering Sustainable Entrepreneurship: How Governance and Digital Infrastructure Reframe Entrepreneurial Outcomes?

Empowering Sustainable Entrepreneurship: How Governance and Digital Infrastructure Reframe Entrepreneurial Outcomes? | Research Square window.SnipcartSettings = { analytics: { enabled: false } }; (function() { var accessVector = localStorage.getItem('access_vector') || ''; window.dataLayer = window.dataLayer || []; if (accessVector) { window.dataLayer.push({ user: { profile: { profileInfo: { snid: accessVector } } } }); } })(); (function(w,d,s,l,i){w[l]=w[l]||[];w[l].push({'gtm.start':new Date().getTime(),event:'gtm.js'});var f=d.getElementsByTagName(s)[0],j=d.createElement(s),dl=l!='dataLayer'?'&l='+l:'';j.async=true;j.src='https://www.googletagmanager.com/gtm.js?id='+i+dl;f.parentNode.insertBefore(j,f);})(window,document,'script','dataLayer','GTM-K279D39R'); Browse Preprints In Review Journals COVID-19 Preprints AJE Video Bytes Research Tools Research Promotion AJE Professional Editing AJE Rubriq About Preprint Platform In Review Editorial Policies Our Team Advisory Board Help Center Sign In Submit a Preprint Cite Share Download PDF Article Empowering Sustainable Entrepreneurship: How Governance and Digital Infrastructure Reframe Entrepreneurial Outcomes? Faisal Alfehaid, Anis Omri This is a preprint; it has not been peer reviewed by a journal. https://doi.org/ 10.21203/rs.3.rs-7796316/v1 This work is licensed under a CC BY 4.0 License Status: Posted Version 1 posted You are reading this latest preprint version Abstract This study examines the role of entrepreneurship in promoting economic sustainability in emerging economies, with a particular focus on the moderating effects of digital infrastructure and entrepreneurial governance. Drawing on panel data from 17 emerging countries over the period 2002–2021, the analysis distinguishes between opportunity-driven, necessity-driven, and total early-stage entrepreneurial activity (TEA) to assess their individual and combined effects on economic sustainability. The study employs robust econometric techniques, including the Augmented Mean Group (AMG) estimator, and examines interaction effects through moderation analysis. Findings indicate that opportunity entrepreneurship significantly enhances economic sustainability, while necessity-driven entrepreneurship exerts a negative effect. TEA shows no significant direct impact. However, the inclusion of moderating variables alters these relationships: digital infrastructure and entrepreneurial governance reinforce the positive influence of opportunity entrepreneurship, rendering the TEA impact statistically significant. Notably, only entrepreneurial governance successfully moderates the adverse effect of necessity entrepreneurship. These results underscore the importance of institutional and technological enablers in translating entrepreneurial efforts into sustainable outcomes. The study presents key policy implications, advocating for strategic investments in digital ecosystems and reforms to governance frameworks to cultivate inclusive and innovation-driven entrepreneurship. Business and commerce/Business and management Social science/Business and management Business and commerce/Economics Social science/Economics Business and commerce/Information systems and information technology Entrepreneurship Economic sustainability Digitalization Entrepreneurial governance Figures Figure 1 Figure 2 Figure 3 1. Introduction Achieving economic sustainability in emerging economies presents profound and multifaceted challenges. These countries often face structural vulnerabilities, including low industrial diversification, excessive reliance on volatile commodity exports, and persistent macroeconomic instability. Additionally, barriers such as weak governance, bureaucratic inefficiencies, corruption, and limited access to finance hinder the development of inclusive and resilient economic systems. As highlighted by Cervelló-Royo et al. ( 2024 ), macroeconomic stability, investment freedom, and sound regulatory frameworks are crucial for fostering entrepreneurship and promoting sustainable growth in regions such as Latin America. Without these conditions, many emerging economies remain trapped in cycles of stagnation, unemployment, and underdevelopment. The adverse impact of institutional rigidity and social exclusion, particularly on youth and marginalized groups, has also been emphasized by Raimi ( 2024 ), who warns that unequal access to resources can undermine sustainability efforts and limit the transformative capacity of entrepreneurship. Entrepreneurship has emerged as a vital mechanism for promoting economic sustainability within this context. Schumpeter’s ( 1934 ) foundational theory conceptualized the entrepreneur as a dynamic agent of "creative destruction," introducing innovations that disrupt and revitalize existing economic systems. This view remains central to contemporary understandings of entrepreneurship’s role in advancing productivity, structural transformation, and technological progress. According to Raimi ( 2024 ), entrepreneurship not only fosters innovation but also enables economies to respond to ecological constraints and structural challenges through adaptive, sustainable systems. These systems are especially valuable in resource-scarce and institutionally fragile settings. Elmonshid and Sayed ( 2024 ) further reinforce this perspective in their examination of Saudi Arabia’s Vision 2030, where entrepreneurship contributes to job creation, gender equity, and green economic transformation—pillars that align with the broader objectives of the United Nations Sustainable Development Goals (SDGs). Thus, entrepreneurship serves as a strategic enabler in a rapidly changing global economic landscape, catalyzing inclusive and environmentally sound growth in emerging markets. A substantial body of empirical literature supports the claim that entrepreneurship enhances economic sustainability. Studies such as those by Magd et al. ( 2023 ) and Ordeñana et al. ( 2024 ) demonstrate a positive correlation between entrepreneurial activity and national development indicators, including innovation performance, economic diversification, and employment generation. Magd et al. ( 2023 ) demonstrate bi-directional causality between entrepreneurship and economic performance across more than 100 countries, highlighting a reinforcing development cycle. Ordeñana et al. ( 2024 ) also differentiate between types of entrepreneurial activities, noting that innovation-driven ventures contribute more significantly to sustainable growth. These insights suggest that entrepreneurship is not a monolithic concept; its impact varies depending on the enabling environment and institutional support. Despite these advancements, the literature reveals critical gaps. In particular, limited attention has been given to the mechanisms through which entrepreneurship fosters economic sustainability. While general associations have been confirmed, the exact pathways—especially in the context of emerging economies—require further scrutiny. Two mechanisms stand out in the literature for their strategic relevance and underexplored potential: entrepreneurial governance and digital infrastructure. Entrepreneurial governance refers to institutional arrangements and governance systems that support transparency, innovation, and inclusivity in entrepreneurial activities. Grandori ( 2024 ) describes this mode as a hybrid system distinct from conventional capitalist or collectivist frameworks, emphasizing adaptive organizational forms and normative alignment with public policy. Raimi and Haini ( 2024 ), in their study on ECOWAS countries, find strong correlations between normative governance elements (such as business freedom and government integrity) and entrepreneurial-driven economic growth. Similarly, digital infrastructure—comprising broadband access, mobile technologies, and digital platforms—serves as a critical enabler of sustainable entrepreneurship. Rooted in the Resource-Based Theory (Barney, 1991 ; Wernerfelt, 1984 ), digital infrastructure is seen as a strategic resource that fosters access to information, reduces transaction costs, and enables business scalability. Li et al. ( 2024 ) show that digital environments in China significantly stimulate individual entrepreneurship by providing flexible workspaces and better market insights. Schade and Schuhmacher ( 2022 ) reinforce this by identifying digital tools as "external enablers" that enhance self-efficacy and opportunity recognition. Yet, in much of the existing literature, these mechanisms are either considered in isolation or insufficiently integrated into broader analyses of entrepreneurship and sustainability. This study addresses this gap by systematically evaluating how entrepreneurial governance and digital infrastructure interact to mediate the effects of entrepreneurship on economic sustainability in emerging markets. To fill the identified gaps in the literature, this study investigates the roles of entrepreneurial governance and digital infrastructure as mediating mechanisms through which entrepreneurship contributes to economic sustainability. The research focuses on 16 emerging economies over 18 years (2004–2021), allowing for the observation of long-term trends and structural shifts. Drawing from cross-national panel data, the study examines how variations in governance quality and digital readiness influence the impact of entrepreneurship on economic resilience and development. This design accounts for institutional heterogeneity and offers a robust empirical foundation for generalizing findings across different emerging market contexts. The study makes several key contributions to the literature. First, it advances the theoretical integration of institutional and technological enablers into the entrepreneurship-sustainability nexus. By positioning entrepreneurial governance and digital infrastructure as mediators, it transcends traditional models that view entrepreneurship as a uniform driver of growth. Second, it provides a comprehensive empirical analysis grounded in both institutional theory (Scott, 1995 ; North, 1990 ) and the Resource-Based View (Barney, 1991 ), offering new insights into how governance and infrastructure shape entrepreneurial ecosystems. Third, the study enhances practical policy relevance by identifying levers, such as regulatory quality, broadband access, and anti-corruption measures, that can amplify entrepreneurship’s sustainability outcomes. For example, Xu et al. ( 2024 ) demonstrate that digital governance in rural regions, such as Tibet, enhances administrative efficiency and expands market access, thereby encouraging entrepreneurial participation. Finally, the study contributes to a growing body of literature advocating for context-specific development models, particularly those that empower local entrepreneurs as agents of sustainable transformation. The article is structured into four sections: a literature review examining the theoretical and empirical foundations; a data and methodology section detailing the econometric framework and data sources; a results and discussion section analyzing the empirical findings; and a conclusion highlighting key results, theoretical contributions, and policy implications. 2. Literature review 2.1. Entrepreneurship and economic sustainability The significance of entrepreneurship in economic development is firmly grounded in classical economic growth theories. Notably, Schumpeter ( 1934 ) emphasized the entrepreneur as a central agent of "creative destruction," introducing innovation and restructuring existing economic systems, which is critical to sustaining long-term growth. This Schumpeterian view remains foundational in understanding how entrepreneurial activities drive technological advancement, productivity, and institutional evolution. Modern extensions of growth theory, including endogenous models, align with this perspective, asserting that innovation and human capital—often fostered through entrepreneurial initiatives—are engines of sustained economic performance. Within this framework, entrepreneurship is not merely a response to opportunity, but a transformative force that reshapes economies toward greater sustainability. Raimi ( 2024 ) affirms that entrepreneurship is vital for a green and resilient economy, functioning as a mechanism for resource efficiency and environmental stability through strategic innovation. He emphasizes that entrepreneurship responds to ecological and structural challenges by creating adaptive systems that can thrive even in resource-scarce settings. Magd et al. ( 2023 ) empirically reinforce these findings using data from over 100 countries, demonstrating that entrepreneurial ecosystems and economic development are interdependent. Their bi-directional causality model reveals that as entrepreneurship expands, economic performance indicators improve, while a growing economy simultaneously nurtures more entrepreneurial ventures. This virtuous cycle suggests that entrepreneurship and economic sustainability are inherently linked through systemic reinforcement. The practical implementation of entrepreneurship as a vehicle for sustainable development is evident in national strategies, such as Saudi Arabia's Vision 2030. Elmonshid and Sayed ( 2024 ) illustrate that entrepreneurship within this framework drives economic diversification, job creation, and innovation—all critical pillars of economic sustainability. Their study reveals how entrepreneurial activity enhances not only economic output but also gender equity, youth employment, and environmentally responsible practices. These results closely resonate with the objectives set forth by the United Nations SDGs, thereby strengthening the premise that entrepreneurship is pivotal in fostering expansive and inclusive economic growth. Ordeñana et al. ( 2024 ) found that creative entrepreneurship, particularly in product development, technical integration, and export orientation, has a considerable impact on national economic growth. Their findings differentiate between types of entrepreneurship, suggesting that innovation-intensive ventures yield the most substantial benefits for long-term sustainability. These insights suggest that entrepreneurship is most effective when integrated into coherent macroeconomic strategies and supported by institutional alignment, facilitating both economic diversification and structural transformation. Nevertheless, the actualization of entrepreneurship's comprehensive potential in fostering economic sustainability is accompanied by significant challenges. Institutional barriers, including regulatory inefficiencies, limited access to financial resources, and socio-cultural constraints, can hinder inclusive and equitable entrepreneurial development. Raimi ( 2024 ) warns that imbalanced power dynamics and institutional rigidities may hinder entrepreneurship's ability to contribute holistically to sustainability, potentially reinforcing social exclusion. This calls for a deliberate policy orientation that fosters inclusive entrepreneurship, especially among marginalized groups. According to Cervelló-Royo et al. ( 2024 ), the efficiency of entrepreneurship as a driver of economic growth is heavily influenced by current macroeconomic stability and regulatory settings. Their findings from Latin America suggest that economic growth is accelerated when entrepreneurial activity is supported by investment freedom, moderate inflation, and low tax burdens. Khyareh and Zamani ( 2022 ) note that the institutional environment, particularly economic freedom and market openness, has a significant influence on the magnitude of entrepreneurship's contribution to economic growth. In economies with greater freedom and supportive regulatory frameworks, entrepreneurship not only flourishes but also becomes a powerful tool for fostering economic resilience and sustainability. Similarly, Yusuf and Albanawi ( 2016 ) reinforce that entrepreneurship is a driver of productivity and national competitiveness when aligned with long-term development strategies. Classical theories, such as those by Lewis ( 2013 ), also support this view, indicating that sustainable output growth is driven by institutions that facilitate entrepreneurship and innovation. The results presented align with the conclusions drawn by Toma et al. ( 2014 ), who assert that entrepreneurial endeavors exhibit a dynamic reaction to technological upheavals and fluctuations in the global economy, thereby positioning it as a robust approach for promoting sustainable development. Neumann ( 2021 ) similarly delineates the complex influence of entrepreneurship on economic, social, and environmental well-being, concluding that its net positive effect is significantly contingent upon institutional and contextual factors. These determinants—education, access to finance, regulatory efficiency, and digital infrastructure—form the foundation of robust entrepreneurial ecosystems. Thus, the consistent theme across the literature is that while entrepreneurship is a powerful engine of sustainability, its effectiveness is significantly enhanced by enabling ecosystems and supportive public policy. Considering the extensive body of empirical and theoretical research, it is justifiable to infer that entrepreneurial endeavors make a significant contribution to promoting economic sustainability. The literature examined consistently indicates that entrepreneurial activities facilitate not merely immediate economic expansion but also foster the enduring stability and resilience of economies via mechanisms of innovation, diversification, and social inclusivity. Entrepreneurship fosters dynamic ecosystems that respond effectively to environmental challenges, generate employment, and promote inclusive development across diverse economic contexts. It operates as both a mechanism for economic renewal and a bridge toward achieving sustainability goals when supported by favorable institutional, regulatory, and macroeconomic conditions. Moreover, the evidence confirms that the impact of entrepreneurship extends beyond economic metrics, influencing social and environmental sustainability dimensions. Therefore, based on robust multi-country studies, theoretical models, and policy-oriented frameworks, the following is the first hypothesis. H1: Entrepreneurial activity positively contributes to economic sustainability. 2.2. The role of entrepreneurial governance The role of governance in shaping entrepreneurial ecosystems can be rigorously understood through the lens of the theory of the firm and institutional theory. The theory of the firm, particularly as conceptualized by Coase ( 1937 ) and later Williamson ( 1981 ), explains how firms emerge and organize transactions efficiently within or outside markets. In entrepreneurial contexts, this theory reveals how governance structures influence the allocation of decision-making authority, control over resources, and the distribution of risks and rewards—all critical aspects of enabling innovative ventures. Simultaneously, institutional theory, as articulated by Scott ( 1995 , 2001 ), posits that the regulatory, normative, and cognitive pillars of society shape the behavior and legitimacy of organizations. When applied to entrepreneurship, this theory highlights how governance institutions provide the rules, norms, and shared beliefs that either facilitate or hinder entrepreneurial activity. As such, institutional theory underscores how external governance environments shape not only the feasibility of entrepreneurial activity but also its legitimacy and sustainability (North, 1990 ; Scott, 1995 ). Together, these theories offer a robust framework for understanding how governance—both internal to firms and external at the institutional level—shapes entrepreneurial ecosystems and enables entrepreneurship to contribute to long-term economic sustainability. As Grandori ( 2024 ) argues, entrepreneurial governance is unique from capitalist or collective modes, characterized by hybrid ownership and adaptive organizational forms. These forms reconcile risk-taking with institutional accountability, thereby offering a conducive environment for entrepreneurship to flourish. Raimi and Haini ( 2024 ) reinforce this view by demonstrating that in ECOWAS economies, normative governance elements—especially government integrity and business freedom—are significantly correlated with economic growth through entrepreneurship. This underscores that when governance aligns with entrepreneurial values such as innovation, transparency, and inclusivity, it fosters not only firm formation but also economic sustainability by encouraging responsible and scalable business activity. Entrepreneurial governance functions as an institutional enabler that directly shapes the scope, scale, and sustainability of entrepreneurial initiatives. Governance mechanisms—such as regulatory quality, rule of law, anti-corruption frameworks, and policy consistency—reduce uncertainty and enhance trust, thereby lowering the cost and perceived risk of business entry. Empirical findings by Abegaz et al. ( 2023 ), based on data from 126 countries, confirm that governance indicators, such as government effectiveness and regulatory quality, have a strong and statistically significant influence on the number of formal business startups. This indicates that well-functioning governance systems do more than set the rules—they actively inspire economic agency. Méndez-Picazo et al. ( 2012 ) further contextualize this by emphasizing that governance systems influence entrepreneurship by shaping macro-level institutional behavior and directly impacting economic outcomes. The result is a reinforcing feedback loop: better governance fosters more entrepreneurship, and vibrant entrepreneurial activity contributes to stronger economic structures. Xu et al. ( 2024 ) extend this argument by introducing the role of digital governance in enabling entrepreneurship in less developed regions. Their study on Tibet demonstrates that digital governance infrastructures can significantly enhance entrepreneurial activity, particularly through improved access to information, streamlined administrative procedures, and expanded market opportunities. Thus, governance not only facilitates entrepreneurship through regulatory clarity but also enables it through technological and procedural innovations. In all these contexts, entrepreneurial governance is shown to be more than supportive—it becomes a strategic driver that activates entrepreneurship as a force for sustainable economic transformation. Moreover, entrepreneurial governance is normative in guiding entrepreneurship toward sustainable outcomes by embedding ethical decision-making, risk responsibility, and social inclusion into institutional practices. Carroll ( 2017 ) presents a comprehensive framework for entrepreneurial governance that integrates key entrepreneurial traits—such as opportunity recognition, innovation, and implementation—with public sector principles like accountability and risk mitigation. His framework responds to the critique that traditional governance structures are often risk-averse and ill-suited for supporting entrepreneurial dynamism. Instead, entrepreneurial governance encourages a shift in public policy from mere regulation to proactive support of innovation ecosystems. This perspective is echoed by Olsson et al. ( 2020 ), who provide evidence from Swedish municipalities showing that entrepreneurial governance at the local level, particularly in urban areas, is positively associated with employment growth. Their findings demonstrate that entrepreneurial governance facilitates not only business creation but also regional economic resilience. Additionally, the presence of sub-components, such as opportunity discovery and resource mobilization, was positively correlated with economic outcomes, even in rural contexts, demonstrating the adaptability of entrepreneurial governance across different development levels. These results confirm that entrepreneurial governance can promote inclusive and equitable growth by integrating localized strategies, fostering public-private collaboration, and promoting the creation of shared value. In effect, governance structures become agents of sustainability, channeling entrepreneurial energy into ventures that are resilient, socially beneficial, and aligned with long-term developmental goals. Drawing from the breadth of theoretical frameworks and empirical evidence discussed, it becomes evident that entrepreneurial governance is not only a catalyst but also a directional force that channels entrepreneurial activity toward sustainable economic outcomes. Governance structures that emphasize institutional quality, transparency, innovation support, and responsible risk-taking create fertile ground for entrepreneurship to emerge, scale, and align with long-term developmental goals. Whether through digital governance in underdeveloped regions, municipal-level policies in urban economies, or national strategies across developing and developed countries, the enabling power of entrepreneurial governance is repeatedly affirmed. By shaping the regulatory, normative, and cognitive environments in which entrepreneurship takes place, governance directly influences both the quantity and quality of entrepreneurial ventures. These ventures, in turn, contribute to inclusive growth, job creation, and resilience against economic shocks—core tenets of economic sustainability. The impact of entrepreneurial governance is both theoretically grounded and empirically validated. Entrepreneurial governance is not just supportive of entrepreneurship; it is instrumental in ensuring that entrepreneurial initiatives yield enduring, sustainable economic impacts. Therefore, the second hypothesis is as follows. H2: Entrepreneurial governance drives entrepreneurial activity to achieve economic sustainability. 2.3. The role of digital infrastructure The Resource-Based Theory (RBT) offers a foundational lens through which to understand the strategic role of digital infrastructure in promoting entrepreneurial activity and achieving economic sustainability. According to RBT, firms gain and sustain a competitive advantage by acquiring and effectively deploying valuable, rare, inimitable, and non-substitutable (VRIN) resources (Barney, 1991 ). In the context of entrepreneurship, digital infrastructure—encompassing broadband access, mobile technologies, digital platforms, and ICT systems—qualifies as such a resource, as it is increasingly essential yet unevenly distributed, thus offering a basis for competitive differentiation (Wernerfelt, 1984 ; Bharadwaj, 2000 ). It enhances firms’ and individuals’ ability to access markets, process information, and innovate efficiently. The theory posits that when digital capabilities are embedded within entrepreneurial ecosystems, they serve as strategic assets that drive the creation of new ventures, scalability, and long-term performance. Empirical studies confirm this theoretical insight. For instance, Li et al. ( 2024 ) demonstrate that digital infrastructure significantly enhances individual entrepreneurship in China by creating enabling conditions, such as flexible work environments and improved access to information related to opportunities. Digitalization reduces transaction costs and uncertainty, especially for disadvantaged groups, thus broadening the entrepreneurial base. Schade and Schuhmacher ( 2022 ) further reinforce this by showing that digital infrastructure moderates the relationship between individual cognitive traits and entrepreneurial action formation, thus functioning as an external enabler. This means that a robust digital environment enhances self-efficacy and opportunity recognition, leading to more frequent and confident entrepreneurial behaviors. Moreover, rural entrepreneurship studies, such as those by Bowen and Morris ( 2019 ), reveal that inadequate digital infrastructure hinders entrepreneurial potential, innovation, and economic diversification in rural areas. In contrast, digitally equipped regions show higher startup rates, innovation levels, and resilience—core dimensions of sustainable economic ecosystems. Beyond enabling access, digital infrastructure serves as a mechanism for entrepreneurs to overcome traditional barriers related to capital, information, and social connectivity—factors emphasized by Resource-Based Theory (RBT) and Resource Dependence Theory. Wei et al. ( 2024 ) show that digital infrastructure enhances household entrepreneurship by mitigating financial constraints, expanding social networks, and fostering information advantages. These mechanisms, facilitated by widespread broadband adoption and mobile technologies, improve not only the frequency of entrepreneurial activity but also its quality and sustainability. Wu et al. ( 2023 ) corroborate these findings by demonstrating that regional digital infrastructure has a significant impact on enterprise-level digital transformation, which in turn promotes entrepreneurial orientation (EO). Here, EO is strengthened through improved knowledge flows, inter-organizational collaboration, and agile decision-making—an entrepreneurial mindset critical to sustaining innovation. In urban settings, Xiong et al. ( 2024 ) find that cities with stronger digital infrastructure benefit from increased entrepreneurial activity, particularly in sectors that leverage digital financial inclusion and expand consumer networks. These outcomes are not accidental but rather the product of systemic enablers grounded in infrastructure. From this perspective, digital infrastructure serves as a bridge, connecting entrepreneurial intention with execution by equipping potential entrepreneurs with the necessary tools and resources to succeed. Yin et al. ( 2019 ) and Gomes and Lopes ( 2022 ) extend this understanding by emphasizing how mobile payments, broadband, and internet access enhance risk tolerance, social capital, and innovative capacity. These digitally-enabled traits are not merely facilitators of business formation—they are foundational to the emergence of resilient, scalable, and economically sustainable ventures. These findings collectively validate RBT’s assertion that when strategically embedded and leveraged, infrastructure becomes a core organizational and societal resource. Crucially, digital infrastructure does not merely facilitate entrepreneurship—it aligns entrepreneurial activity with the goals of economic sustainability by fostering innovation, inclusivity, and environmental awareness. Hussain et al. ( 2024 ) find that digital infrastructure has a direct and significant effect on innovation performance within SMEs, particularly when combined with e-knowledge and digital innovation. This interplay ensures that entrepreneurial activity is not just economically productive but also ecologically and socially aligned with long-term sustainability objectives. Wang et al. ( 2024 ) note that the digital economy, driven by infrastructure, enhances the quality of human capital and promotes entrepreneurial dynamism, particularly in urban areas. This synergy yields shared prosperity, equitable growth, and reduced inequality, all of which are key pillars of sustainable development. In Saudi Arabia, studies by Altwaijri et al. ( 2024 ) and Alfehaid et al. ( 2024 ) confirm that ICT diffusion, especially when coupled with opportunity-driven entrepreneurship, contributes significantly to environmental and economic sustainability. These interactions show how digital infrastructure not only supports business creation but also shapes its direction toward sustainable goals. Moreover, the Global Index of Digital Entrepreneurship Systems (GIDES), developed by Autio et al. ( 2024 ), demonstrates that national-level digital conditions—including infrastructure, culture, and institutional support—are crucial in fostering high-quality, systemically impactful entrepreneurship. Digitalization thus serves a dual role: as a catalyst for entrepreneurial activity and as a framework condition ensuring that this activity aligns with long-term sustainability objectives. Through integrating digital tools, platforms, and systems, entrepreneurs can optimize resource use, innovate responsibly, and contribute to more inclusive economic systems—essential outcomes for resilient societies in the digital age. Based on the accumulated theoretical insights and empirical evidence, it is reasonable to deduce that digitalization, underpinned by robust digital infrastructure, drives entrepreneurial activity in ways that meaningfully contribute to economic sustainability. Rooted in resource-based theory, digital infrastructure emerges as a strategic resource that enhances the capabilities of individuals and organizations to identify, exploit, and sustain opportunities. It lowers barriers to entry, facilitates innovation, and enables inclusive participation in economic systems. Moreover, it ensures that entrepreneurial ventures are not only viable but also aligned with the broader goals of sustainability—be they environmental, economic, or social. Whether through improved financial access, expanded market reach, enhanced innovation capacity, or reduced environmental footprint, the influence of digital infrastructure is both profound and far-reaching. Digital infrastructure should not be viewed merely as a technological tool but as a strategic and transformative enabler of sustainable entrepreneurship in the 21st century. Therefore, the third hypothesis is as follows: H3: Digitalization drives entrepreneurial activity to achieve economic sustainability. As illustrated in Fig. 1 , entrepreneurial governance and digital infrastructure are essential pillars of economic sustainability. While governance ensures that entrepreneurial activities are effectively guided, regulated, and aligned with long-term development goals, digital infrastructure provides the technological backbone that enables innovation, efficiency, and scalability of entrepreneurial ventures. Together, they form a complementary and dynamic system that facilitates the transition toward a more inclusive, resilient, and sustainable economic future. 3. Data and Methodology 3.1. Data This study draws on an unbalanced panel dataset covering 16 emerging economies from 2004 to 2021, selected based on data availability from the Global Entrepreneurship Monitor (GEM), World Development Indicators (WDI), Heritage Foundation (HF), and United Nations databases (Table 1 ) The focus on emerging economies is intentional, given their structural vulnerabilities and opportunities for leveraging entrepreneurship as a tool for economic transformation. These countries—Argentina, Brazil, China, Colombia, Egypt, India, Indonesia, Iran, Malaysia, Mexico, Peru, the Philippines, Romania, South Africa, Thailand, and Turkey—represent dynamic settings where entrepreneurial governance and digital infrastructure can significantly affect sustainability outcomes. The key variables selected to illustrate how the different types of entrepreneurship influence economic sustainability include: 3.1.1. Dependent variable The dependent variable in this study is economic sustainability, measured using a composite index constructed by the authors through Principal Component Analysis (PCA). As shown in Table 2 , this index captures the structural soundness and long-term viability of economic systems by integrating five key indicators aligned with Sustainable Development Goals (SDGs) 7 (Affordable and Clean Energy), 8 (Decent Work and Economic Growth), 9 (Industry, Innovation and Infrastructure), 11 (Sustainable Cities and Communities), and 12 (Responsible Consumption and Production). All indicators were standardized using the Min-Max Normalization technique to harmonize units and ensure that higher values reflect stronger sustainability performance. Missing values were addressed using mean imputation, following the recommendations of Kondyli (2010) to maintain data consistency while preserving as much information as possible. To construct the composite Economic Sustainability Index (ESI), PCA was applied to the standardized indicators to extract the principal components explaining the majority of the variance across countries and time. The adequacy of the data for PCA was assessed through the Kaiser-Meyer-Olkin (KMO) test and Bartlett’s Test of Sphericity. Components with eigenvalues greater than one were retained, and the final index was computed as a weighted average of these components using their eigenvalues as weights. This approach aligns with the methodology proposed by Costanza et al. (2016), ensuring the index is statistically robust and conceptually grounded. The resulting ESI ranges from 0 to 1, with higher values indicating stronger economic sustainability, and is used as the main dependent variable in the empirical models to evaluate the impact of entrepreneurship, governance, and digital infrastructure in emerging economies. The general form of a principal component (PC) can be expressed mathematically as: $$\:{b}_{1}^{p}{X}_{1}^{p}+\dots\:+{b}_{n}^{p}{X}_{n}^{p}$$ 1 Where PC p is the score of the principal component p, b p n ​ represents the weight (or loading) assigned to the n th standardized variable of the p th component, and X p n is the standardized value of the n th variable for unit p. As reported in Table 3 , the ESI is constructed using two principal components (eco1 and eco2) extracted from the PCA. These two components together account for 85.14% of the total variance, with eco1 explaining 52.84% and eco2 contributing an additional 32.30%. This high cumulative variance indicates that the selected components capture the dominant underlying structure of the economic sustainability construct. The three remaining components (eco3 to eco5) were excluded due to their marginal explanatory power, as they accounted for only 14.86% of the variance. The final index is derived using a weighted aggregation approach based on the eigenvalues of the retained components. Following Bregar et al. (2008), the aggregated index is formulated as: $$\:{ESI}_{p}=\frac{{\sum\:}_{i=1}^{m}{F}_{Pi}*{\lambda\:}_{i}}{{\sum\:}_{i=1}^{m}{\lambda\:}_{i}}$$ 2 Where ESIp ​ is the Economic Sustainability Index for country p, eco1p and eco2p are the scores of the first and second principal components, respectively, and λ1and λ2 are their corresponding eigenvalues used as weights. The application of this formula ensures that components with greater explanatory power contribute proportionally more to the final index. The KMO measure of 0.657 and the highly significant Bartlett’s Test of Sphericity (p < 0.01) confirm the adequacy of the data for PCA and the existence of meaningful correlations among the variables. Overall, the constructed ESI serves as a reliable and statistically grounded composite indicator for evaluating economic sustainability in emerging economies across the study period. Table 1 Measures, sources, and expected signs of the variables. Variable Measurement Source Mean SD Min. Max. Dependent variable Economic sustainability Economic sustainability index Authors’ calculation 0.396 0.202 0 1 Independent variables Opportunity entrepreneurship The percentage of individuals aged 18 to 64 who start a new business to seize a promising market opportunity, driven by innovation, profit potential, or personal ambition rather than necessity. GEM 49.469 16.580 5.590 97.989 Necessity entrepreneurship The percentage of individuals aged 18 to 64 who start a new business due to a lack of better employment options, often driven by economic need rather than the pursuit of opportunity. GEM 34.399 22.491 2.020 85 Total Early-stage Entrepreneurial Activity (TEA) The percentage of the adult population (aged 18 to 64) who are actively engaged in starting a new business (nascent entrepreneurs) or managing a business less than 42 months old. GEM 15.825 10.365 4.021 51.309 Moderator variables Digital infrastructure E-governance Electronic Government Development Index (EGDI) United Nations 0.562 0.120 0.265 0.891 ICT use Individuals using the Internet (% of population) WDI 40.034 23.321 1.976 96.8 Entrepreneurial governance Government integrity Government integrity index (0–100) HF 35.308 7.475 10 55.4 Business Freedom Business freedom index (0–100) HF 63.8199 11.340 35.5 93.5 Investment freedom Investment freedom index (0–100) HF 47.676 18.262 0 80 Control variables Trade The sum of exports and imports of goods and services as a percentage of Gross Domestic Product (GDP). WDI 61.067 34.345 22.106 210.374 Financial development Domestic credit to the private sector by banks (% of GDP) WDI 53.489 36.038 9.501 179.1 Rule of law The Rule of Law score ranges from approximately − 2.5 to 2.5, indicating a country's relative standing compared to the Rule of Law index average. WDI -0.289 0.385 -1.054 0.6 Note: N = 288 observations from an unbalanced panel dataset from 16 emerging countries from 2004 to 2021. Countries include Argentina, Brazil, China, Colombia, Egypt, India, Indonesia, Iran, Malaysia, Mexico, Peru, the Philippines, Romania, South Africa, Thailand, and Turkey. GEM is the Global Entrepreneurship Monitor, WDI is the World Development Indicators, and HF is the Heritage Foundation. Table 2 Measure and source of the SDGs’ indicators. Goal Indicators Sources Economic Sustainability 7 Access to clean fuels and technologies for cooking (% of the population) WDI 8 Annual GDP per Capita Growth (%) 9 Manufacturing value added (% of GDP) 11 Urban population (% of total population) 12 Adjusted Net Savings (excluding damage from particulate emissions) (% of GNI) Table 3 PCA results of the SDI. Component Eigenvalue Proportion explained (%) Cumulative (%) Eco1 2.642 52.84 52.84 Eco2 1.615 32.30 85.14 Eco3 0.431 8.62 93.76 Eco4 0.212 4.24 98 Eco5 0.100 2.00 100.00 KMO 0.657 Bartlett Test (p-value) 0.000 3.1.2. Independent variables This study includes three distinct measures of entrepreneurial activity as independent variables, drawn from the Global Entrepreneurship Monitor (GEM): Total Early-stage Entrepreneurial Activity (TEA), opportunity-driven entrepreneurship, and necessity-driven entrepreneurship. TEA represents the percentage of the adult population (aged 18–64) who are actively engaged in either starting a new business (nascent entrepreneurs) or managing a business that is less than 42 months old. It provides a broad measure of entrepreneurial dynamism within a country, capturing both necessity- and opportunity-motivated business creation. Opportunity-driven entrepreneurship refers to individuals who launch a business to pursue a promising market opportunity, motivated by innovation, financial potential, or personal ambition rather than a lack of alternatives. This form of entrepreneurship is widely associated with higher productivity, innovation spillovers, and more sustainable economic outcomes (Acs et al., 2008 ; Audretsch & Keilbach, 2004 ; Dean & McMullen, 2007 ). In contrast, necessity-driven entrepreneurship reflects individuals who start a business due to the absence of better employment options, often under constrained economic circumstances. While such activity may provide subsistence-level income and reduce unemployment in the short term, it tends to have lower growth potential and limited long-term impact on economic sustainability (Reynolds et al., 2005 ; Poschke, 2013 ). By distinguishing among these entrepreneurial forms, the analysis captures important heterogeneity in how entrepreneurship influences economic sustainability. Prior research suggests that opportunity-driven and TEA entrepreneurship are more likely to foster structural transformation, innovation, and formal sector employment, whereas necessity-driven ventures may remain informal, vulnerable, and less productive (van Stel et al., 2005 ; Belz & Binder, 2017 ). Including these differentiated indicators allows the study to examine both the quality and quantity of entrepreneurial activity and their respective contributions to economic sustainability in emerging markets. All three measures are sourced from the GEM database and are reported as percentages of the working-age population. 3.1.3. Moderator variables The two moderating variables included in this study are Digital Infrastructure (DI) and Entrepreneurial Governance (EG). Digital Infrastructure reflects a country’s technological readiness and the digital environment that supports entrepreneurial activities, innovation diffusion, and business scalability. It is measured using two core indicators: the Electronic Government Development Index (EGDI) and the percentage of individuals using the Internet. EGDI assesses how effectively a government utilizes digital tools to deliver public services, promote transparency, and facilitate business interactions with public institutions, thereby enhancing administrative efficiency (United Nations, 2020 ). The share of individuals using the Internet captures the extent of digital penetration and accessibility within the economy, indicating the level of integration of digital technologies into business practices and daily life. A stronger digital infrastructure is expected to enhance the connection between entrepreneurship and economic sustainability by promoting innovation, facilitating market access, and improving operational efficiency. Entrepreneurial Governance (EG), the second moderating variable, captures the quality of the institutional and regulatory environment that shapes entrepreneurial behavior and business viability. It is assessed through three key dimensions from the Heritage Foundation Index: government integrity, business freedom, and investment freedom. Government integrity reflects the degree of transparency, control of corruption, and ethical standards in public institutions, which can reduce transaction costs and promote trust-based entrepreneurial ecosystems. Business freedom measures the burden of regulation on starting and operating businesses, with higher values indicating fewer bureaucratic obstacles and greater market flexibility. Investment freedom assesses the extent to which capital can flow freely in and out of an economy without restrictions, which is essential for entrepreneurship to thrive in capital-intensive sectors. Collectively, these components provide a nuanced understanding of how institutional quality and policy frameworks influence the relationship between entrepreneurship and sustainability. 3.1.4. Control Variables Consistent with the sustainability literature, this study incorporates several control variables that are likely to influence economic sustainability: trade openness, financial development, and the rule of law. Trade openness, measured by the sum of exports and imports as a percentage of GDP, is expected to support economic sustainability by facilitating technology transfer, expanding market access, and encouraging specialization based on comparative advantage. Greater integration into global markets can enhance productivity and competitiveness, thereby contributing to more resilient economic structures. Financial development, measured by domestic credit to the private sector as a percentage of GDP, is expected to positively impact economic sustainability, as well-functioning financial systems mobilize capital, allocate resources efficiently, and support long-term investments in innovation and infrastructure (Ben Youssef et al., 2020; Slimani et al., 2024). The rule of law is also included as a key institutional control variable, reflecting the quality of governance, legal enforcement, and regulatory frameworks. A stronger rule of law enhances investor confidence, protects property rights, and ensures policy stability—factors that are fundamental to economic resilience and sustainable growth. Prior studies have shown that countries with higher rule-of-law scores tend to experience greater institutional effectiveness and long-term economic performance (Ben Youssef et al., 2020; Altwaijri et al., 2024 ). Together, these control variables help account for the broader macroeconomic and institutional context that may shape the relationship between entrepreneurship and economic sustainability. Table 1 presents the descriptive statistics for the variables used in this study. The ESI, the key dependent variable measuring the economic dimension of sustainable development, has an average value of 0.396, with observed values ranging from 0.000 to 1.000 across countries and years. Regarding entrepreneurial activity, opportunity-driven entrepreneurship—defined as the proportion of individuals aged 18 to 64 who initiate a business in response to market opportunities—has a mean of 49.33%, with values ranging from 5.59% to 97.98%. In contrast, necessity-driven entrepreneurship, which reflects business creation due to a lack of better options, shows a lower average of 31.25%, ranging from 2.02% to 85%. The overall TEA has a mean of 17.16% (not shown in this paragraph, but available), capturing both opportunity- and necessity-based ventures. Turning to the moderator variables, government integrity, which reflects perceptions of public sector transparency and corruption, averages 35.18 (out of 100), ranging from 7.48 to 55.40. Business freedom and investment freedom, proxies for the entrepreneurial governance environment, show mean values of 63.56 and 47.39, respectively. On the digital infrastructure side, the EGDI averages 0.556, spanning from 0.000 to 0.891. Access to digital services is also reflected in ICT indicators: ICT access, measured by mobile cellular subscriptions per 100 people, averages 92.05, with values ranging from 4.60 to 181.77, while ICT use, proxied by the percentage of individuals using the internet, records a mean of 40.04%, with a minimum of 1.98% and a maximum of 96.80%. 3.2. Methodology In line with the 2030 Agenda for Sustainable Development, entrepreneurship has emerged as a crucial driver of long-term economic resilience, particularly in emerging economies. Among its forms, opportunity-driven entrepreneurship is recognized for its role in fostering innovation, productivity, and sustainable job creation, unlike necessity-driven entrepreneurship, which typically arises from a lack of alternatives and tends to generate limited long-term economic value (Acs et al., 2018; Autio et al., 2014; Dhahri & Omri, 2018). Given these differences, disaggregating entrepreneurial types is essential to understanding their distinct contributions to economic sustainability. Moreover, the impact of entrepreneurship is shaped by entrepreneurial governance—including regulatory quality and investment freedom—and digital infrastructure, such as e-government readiness and ICT access. These structural enablers facilitate business activity, enhance resource efficiency, and support innovation-led growth (Djankov et al., 2002; World Bank, 2021; Katz & Callorda, 2018). Based on these insights, the proposed framework links TEA, opportunity- and necessity-driven entrepreneurship to economic sustainability, moderated by governance and digital infrastructure, as specified in Eq. ( 3 ): $$\:{ESI}_{it}=\:{{\beta\:}_{0}+{\beta\:}_{1}E}_{it}+{{\beta\:}_{2}DI}_{it}+{{\beta\:}_{3}EG}_{it}+{{\beta\:}_{4}Z}_{it}+{\epsilon\:}_{it}$$ 3 Where ESI denotes the Economic Sustainability Index, the dependent variable of interest. E represents the vector of entrepreneurship indicators, including TEA, opportunity-driven entrepreneurship (OPE), and necessity-driven entrepreneurship (NCE). DI captures digital infrastructure, measured through e-government development and ICT use, while EG refers to entrepreneurial governance, proxied by government integrity, business freedom, and investment freedom. Z denotes a vector of control variables. The subscript i indicates the country (cross-sectional unit), and t denotes the time period. β represents the vector of estimated coefficients, and ε is the stochastic error term. Incorporating the transmission mechanisms of DI and EG, Eq. ( 3 ) is reformulated to account for their potential moderating effects, resulting in the extended specification presented in Eq. ( 4 ) as follows: $$\:{ESI}_{it}=\:{{\beta\:}_{0}+{\beta\:}_{1}E}_{it}+{{\beta\:}_{2}DI}_{it}+{{\beta\:}_{3}EG}_{it}+{\beta\:}_{4}\left({E}_{it}\:\text{x}\:{DI}_{it}\right)+{\beta\:}_{5}\left({E}_{it}\:\text{x}\:{EG}_{it}\right)+{{\beta\:}_{6}Z}_{it}+\:{\epsilon\:}_{it}$$ 4 Where interaction terms \(\:{E}_{it}\:\text{x}\:{DI}_{it}\) and \(\:{E}_{it}\:\text{x}\:{EG}_{it}\) capture the moderating roles of digital infrastructure and entrepreneurial governance on the relationship between entrepreneurship and sustainable development. To estimate the relationships specified in Equations ( 3 ) and ( 4 ), the empirical analysis begins by addressing two key econometric concerns common in macro-panel data: cross-sectional dependence (CSD) and slope heterogeneity. Given the interconnectedness of countries through trade, investment, and the diffusion of technology, ignoring CSD can lead to biased and inconsistent estimates. Thus, we employ the bias-adjusted LM test proposed by Pesaran et al. (2008) to test for the presence of cross-sectional dependence. In parallel, we assess the validity of the homogeneity assumption in slope coefficients across countries using the Δ̃ (delta tilde) and Δ̃adj (adjusted delta tilde) tests developed by Pesaran and Yamagata (2008). These tests are critical for verifying whether the estimated coefficients should be allowed to vary across cross-sectional units, acknowledging the possibility that institutional structures, entrepreneurial dynamics, and digital infrastructure may affect economic sustainability differently across countries. Given the evidence of cross-sectional dependence and slope heterogeneity in the dataset, we adopt the Augmented Mean Group (AMG) estimator, developed by Eberhardt and Teal (2010) and later refined by Eberhardt (2012). This estimator is particularly suited for heterogeneous panels with unobserved common factors and cross-sectional correlation. The AMG method accommodates country-specific slopes and allows for unobservable common shocks by incorporating a "common dynamic process" derived from first-differenced regressions with time dummies. The estimation proceeds in two stages: first, each country's model is estimated in first differences with time dummies capturing the evolution of global shocks; second, the estimated time dummy coefficients are aggregated and introduced as a common factor in the level regressions, producing robust long-run parameter estimates. A significant advantage of AMG is that it does not require prior testing for unit roots or cointegration, as it remains valid regardless of the integration properties of the variables (Bond & Eberhardt, 2013). Moreover, the method provides consistent estimates even in the presence of endogeneity and cross-sectional correlation, making it well-suited to our research context. 4. Results and discussion The results of the tests for cross-sectional dependence and slope homogeneity are reported in Table 4 , where the null hypothesis of no cross-sectional dependence is rejected at the 1% significance level. This outcome is expected given the nature of the variables used in this study, particularly those related to entrepreneurship, governance, and digital infrastructure. Emerging economies in the sample are increasingly interconnected through global trade, FDI flows, technology diffusion, and transnational digital platforms, making the presence of spillover effects highly plausible. Moreover, shared institutional frameworks—such as UNCTAD, the World Bank’s Doing Business initiative, and the 2030 Sustainable Development Agenda—promote convergent policy reforms and governance standards across countries. These dynamics suggest that changes in entrepreneurial environments or digital capacities in one country are likely to influence, or be influenced by, similar shifts in others, validating the existence of cross-sectional interdependence in the panel. Additionally, the null hypothesis of slope homogeneity is also strongly rejected at the 1% level, indicating significant variation in how entrepreneurship and its enabling conditions affect economic sustainability across countries. This result highlights the importance of using estimation methods that do not impose uniform effects across heterogeneous national contexts. Accordingly, the study employs the Augmented Mean Group (AMG) estimator, which explicitly accounts for both cross-sectional dependence and heterogeneous slope coefficients. By doing so, the model enables a more accurate assessment of the long-term relationships between entrepreneurship, institutional and digital enablers, and economic sustainability in emerging economies. The results initially present the direct effects of opportunity-driven entrepreneurship, necessity-driven entrepreneurship, and total early-stage entrepreneurial activity on economic sustainability. Following this, the analysis incorporates interaction terms to examine how the relationship between entrepreneurship and economic sustainability is enhanced by promoting entrepreneurial governance and digital infrastructure. To strengthen the robustness of the findings, each model specification is re-estimated using alternative proxies for entrepreneurial governance (such as government integrity, business freedom, and investment freedom) and for digital infrastructure (including ICT use and e-governance). The empirical results presented in Table 5 reveal nuanced and statistically significant relationships between different forms of entrepreneurship and economic sustainability across the five model specifications. Opportunity-driven entrepreneurship (OPE) consistently exhibits a statistically significant and positive impact on economic sustainability, with coefficients ranging from 0.072 to 0.102 and p-values below 0.1 in all models. This positive association aligns with the conceptual understanding of opportunity entrepreneurship as a proactive, innovation-oriented behavior that fosters the creation of new markets, product development, and structural economic transformation (Ordeñana et al., 2024 ; Raimi, 2024 ). Such entrepreneurial endeavors contribute to long-term growth by addressing market inefficiencies, enhancing competitiveness, and leveraging innovation—effects that resonate with Schumpeter’s ( 1934 ) concept of creative destruction and the endogenous growth framework. Furthermore, the consistent significance of OPE across models supports the argument of Magd et al. ( 2023 ), who demonstrate that opportunity-driven entrepreneurship generates economic value in both developed and emerging economies through innovation diffusion, job creation, and economic diversification. These findings also align with Elmonshid and Sayed ( 2024 ), who link opportunity entrepreneurship to job creation and social inclusion in Saudi Arabia’s Vision 2030, highlighting its role in transforming oil-dependent economies into more resilient and inclusive systems. In contrast, necessity entrepreneurship (NCE) exhibits a consistently negative and statistically significant relationship with economic sustainability across all five model specifications, with coefficients ranging from − 0.122 to − 0.166 and p-values of less than 0.05. This suggests that necessity-based entrepreneurial activity may hinder long-term sustainability, especially in emerging economies where informal enterprises often dominate. Such businesses are typically established in response to unemployment or poverty, rather than driven by innovation, and therefore often lack scalability, market competitiveness, or sustainable income generation (Raimi, 2024 ; Ordeñana et al., 2024 ). These findings corroborate the assertions by Cervelló-Royo et al. ( 2024 ) that without adequate regulatory and macroeconomic support, necessity entrepreneurship often perpetuates economic vulnerability rather than addressing it. Furthermore, Khyareh and Zamani ( 2022 ) warn that in weak institutional environments, necessity entrepreneurship may fail to mobilize resources efficiently, reinforcing informal employment and low productivity traps. This distinction highlights the dual nature of entrepreneurship and supports a differentiated policy approach that prioritizes opportunity-driven ventures while addressing the structural causes of necessity entrepreneurship through inclusive labor policies, financial access, and regulatory reform. Regarding the TEA, the estimates are consistently positive but not statistically significant across all five models, with coefficients ranging from 0.069 to 0.104 and p-values above the 10% threshold. These results suggest that TEA, when aggregated without distinguishing between its opportunity and necessity components, fails to exert a measurable impact on economic sustainability. This outcome emphasizes the importance of disaggregating entrepreneurial activity into its underlying motivations and types, as highlighted by Ordeñana et al. ( 2024 ) and Grandori ( 2024 ), who caution against treating entrepreneurship as a monolithic construct. The lack of statistical significance for TEA implies that the combined effect of heterogeneous entrepreneurial motivations may obscure the true impact of entrepreneurial dynamics on long-term development outcomes. Therefore, the findings reaffirm the necessity of more nuanced analyses and targeted policy measures that account for the quality and context of entrepreneurial activity rather than its aggregate volume. Table 4 Cross-sectional dependence and homogeneity test results. Cross-sectional dependence Slope homogeneity Test Statistic p-value Test Statistic p-value Model 1 (OPE) LM adj 7.128 0.000 \(\:\stackrel{\sim}{\varDelta\:}\) 10.846 0.000 \(\:\stackrel{\sim}{\varDelta\:}\) adj 12.937 0.000 Model 2 (NCE) LM adj 6.789 0.000 \(\:\stackrel{\sim}{\varDelta\:}\) 11.092 0.000 \(\:\stackrel{\sim}{\varDelta\:}\) adj 13.401 0.000 Model 3 (TEA) LM adj 7.563 0.000 \(\:\stackrel{\sim}{\varDelta\:}\) 12.223 0.000 \(\:\stackrel{\sim}{\varDelta\:}\) adj 14.104 0.000 Table 5 Results of the direct effects of entrepreneurship on economic sustainability. Economic Sustainability Digital Infrastructure Entrepreneurial governance 1 2 3 4 5 Opportunity entrepreneurship (OPE) 0.095** (0.011) 0.102*** (0.002) 0.088* (0.055) 0.072* (0.061) 0.100** (0.026) Necessity entrepreneurship(NCE) -0.125** (0.030) -0.139*** (0.000) -0.122** (0.000) -0.166*** (0.000) -0.141*** (0.000) TEA 0.094 (0.125) 0.104 (0.114) 0.069 (0.237) 0.080 (0.149) 0.094 (0.127) E-governance (EGDI) 0.181*** (0.000) ICT 0.144** (0.010) Government integrity (GovI) 0.156*** (0.000) Business freedom (BusF) 0.141*** (0.000) Investment freedom (InvF) 0.118** (0.020) Trade 0.107 (0.111) 0.094 (0.133) 0.113 (0.100) 0.083 (0.123) 0.101 (0.115) Financial development 0.119** (0.016) 0.099** (0.037) 0.104** (0.023) 0.089* (0.055) 0.121*** (0.000) Rule of law 0.161*** (0.000) 0.186*** (0.000) 0.157*** (0.000) 0.170*** (0.000) 0.169*** (0.000) Constant 0.459*** (0.000) 0.649*** (0.000) 0.329*** (0.000) 0.387*** (0.000) 0.441*** (0.000) Note : Columns 1 and include the digitalization indicators (including E-governance and ICT use) and columns 3 to 5 include the entrepreneurial governance indicators (including government integrity, business freedom, and investment freedom). *p < 0.1, **p < 0.05, and ***p < 0.01. The role of digital infrastructure is also examined through two indicators: e-governance (EGDI) and ICT usage. The results reveal strong and statistically significant effects for both variables. E-governance exhibits a positive and highly significant association with economic sustainability, with a coefficient of 0.181 (p < 0.01). Additionally, ICT usage also shows a significant effect, with a coefficient of 0.144 (p < 0.05). These findings are consistent with theoretical expectations derived from the Resource-Based View (Barney, 1991 ; Wernerfelt, 1984 ), which views digital infrastructure as a strategic and scarce resource that enhances information access, reduces transaction costs, and supports innovation and productivity gains. Li et al. ( 2024 ) and Schade and Schuhmacher ( 2022 ) emphasize that digital platforms act as external enablers, particularly for underrepresented groups, by lowering entry barriers and promoting entrepreneurial action formation. Moreover, Xu et al. ( 2024 ) demonstrate that digital governance enhances entrepreneurship through administrative efficiency and expanded market access, especially in remote and underserved regions such as rural China and Tibet. These effects are particularly relevant for emerging economies, where infrastructural asymmetries can significantly constrain entrepreneurial potential. Thus, the empirical results validate the theoretical expectation that digital infrastructure, particularly when institutionalized through e-governance and ICT, plays a catalytic role in aligning entrepreneurship with long-term economic sustainability objectives. Turning to entrepreneurial governance, the indicators of government integrity, business freedom, and investment freedom are all positively and significantly associated with economic sustainability, with coefficients ranging from 0.118 to 0.156 across the models. Specifically, government integrity exhibits the highest impact (0.156, p < 0.01), followed by business freedom (0.141, p < 0.01), and investment freedom (0.118, p < 0.05). These results align with the arguments advanced by institutional theory (Scott, 1995 ; North, 1990 ), which emphasizes the importance of transparent, predictable, and inclusive governance systems in promoting entrepreneurship and economic development. Raimi and Haini ( 2024 ) find that normative elements of governance, such as accountability and regulatory quality, play a decisive role in enabling entrepreneurial ecosystems to flourish, particularly in fragile contexts. The positive and significant effects of these variables suggest that entrepreneurial governance mechanisms not only reduce risk and uncertainty but also enhance resource allocation, stimulate investment, and improve institutional trust—essential conditions for sustainable entrepreneurship. These findings support Grandori’s ( 2024 ) conceptualization of entrepreneurial governance as a hybrid institutional framework that promotes adaptive innovation, public-private collaboration, and inclusive development. Similarly, Olsson et al. ( 2020 ) demonstrate that governance structures that encourage discovery opportunity and resource mobilization yield resilient and scalable ventures, even in peripheral regions. Therefore, the results highlight that robust governance frameworks are indispensable for ensuring that entrepreneurship contributes to resilient and equitable economic systems in emerging economies. To understand how entrepreneurship contributes to economic sustainability in emerging economies, it is crucial to examine the mechanisms that shape this relationship. In this study, special attention is given to the moderating roles of digital infrastructure and entrepreneurial governance. Specifically, we focus on how the effects of entrepreneurship on economic sustainability vary under different levels of these moderator variables. We assess whether the positive or negative impacts of opportunity-driven, necessity-driven, and total entrepreneurial activity change in magnitude or direction when conditioned by digital infrastructure and entrepreneurial governance. This analytical framework draws on insights from the Resource-Based Theory and institutional theory, as emphasized in the works of Barney ( 1991 ) and Li et al. ( 2024 ). Tables 6 , 7 , and 8 present the interaction results, where columns 1 and 2 display the moderating effects of digital infrastructure, and columns 3–5 report the moderating roles of entrepreneurial governance. By estimating these interaction terms, the study aims to uncover context-specific dynamics that shape the effectiveness of entrepreneurship as a tool for sustainable economic transformation. This approach not only enhances the theoretical integration of institutional and technological enablers but also provides policy-relevant insights into how supportive environments can amplify the developmental impact of entrepreneurship. Based on the results presented in Tables 6 to 8 , the inclusion of moderator variables—digital infrastructure and entrepreneurial governance—offers a deeper insight into how various types of entrepreneurship interact with the enabling environment to shape economic sustainability. Focusing first on opportunity-driven entrepreneurship (OPE), the findings show that its interaction with digital infrastructure significantly amplifies its impact on economic sustainability. Specifically, the interaction between OPE and e-governance (EGDI) yields a strong positive effect of 0.133, while the interaction with ICT infrastructure is also significant at 0.126. These results clearly suggest that when opportunity entrepreneurship is supported by robust digital systems, its ability to contribute to economic outcomes improves considerably. This aligns with previous studies emphasizing the digital ecosystem’s enabling role (Li et al., 2024 ; Xiong et al., 2024 ; Gomes & Lopes, 2022 ). Moreover, the moderating role of entrepreneurial governance—comprising government integrity, business freedom, and investment freedom—further reinforces this relationship. The interaction between OPE and government integrity shows a coefficient of 0.148, while interactions with business freedom and investment freedom yield coefficients of 0.151 and 0.139, respectively. These effects are not only statistically significant at the 1% level but also larger than the direct effect of OPE reported in Table 5 (ranging from 0.072 to 0.102), confirming that governance environments characterized by transparency, regulatory quality, and policy consistency strengthen the role of opportunity-driven entrepreneurship in achieving economic sustainability. These findings are consistent with Raimi and Haini ( 2024 ), who argue that when entrepreneurial activity operates under well-functioning institutions, its developmental potential is magnified. Thus, the results provide empirical validation for the hypothesis that institutional and technological enablers—particularly digital infrastructure and governance—serve as crucial amplifiers for OPE-led development trajectories in emerging economies. In contrast, necessity entrepreneurship (NCE) presents a complex interaction with economic sustainability that varies significantly depending on the enabling environment. Table 5 previously showed that the direct effect of NCE on economic sustainability is significantly negative, with coefficients ranging from − 0.122 to − 0.166. However, the interaction results in Table 7 reveal that digital infrastructure fails to mitigate this negative influence, as neither the EGDI (0.058) nor the ICT (0.070) interaction is statistically significant. This suggests that while digital infrastructure can support opportunity entrepreneurship, it does not effectively neutralize the constraints or inefficiencies associated with necessity-driven ventures, possibly due to structural barriers such as low human capital, informal operations, or resource scarcity. Interestingly, when NCE interacts with entrepreneurial governance components, some of the adverse effects are significantly reduced. The interaction with government integrity yields a coefficient of 0.099 (significant at the 5% level), and the interaction with business freedom produces an even stronger effect at 0.106 (significant at the 1% level). These findings demonstrate that governance mechanisms—through the reduction of transaction costs, policy clarity, and rule of law—can partly counterbalance the negative externalities associated with necessity entrepreneurship. This supports Méndez-Picazo et al. ( 2012 ) and Abegaz et al. ( 2023 ), who argue that effective governance systems not only inspire productive entrepreneurship but can also transform survival-based ventures into more formalized and efficient economic actors. Although investment freedom does not yield a statistically significant moderating effect (0.093), the results overall underline the crucial role of institutional quality in redefining the economic trajectory of necessity-based entrepreneurial efforts. Thus, while necessity entrepreneurship alone may be insufficient or even counterproductive in promoting sustainability, its outcomes can be redirected under conducive governance conditions. Table 6 Results of the indirect effects of opportunity entrepreneurship on economic sustainability. Dependent variable: Economic Sustainability Opportunity entrepreneurship (OPE) Digital Infrastructure Entrepreneurial governance 1 2 3 4 5 EGDI \(\:\text{x}\) OPE 0.133*** (0.000) ICT \(\:\text{x}\) OPE 0.126** (0.032) GovI \(\:\text{x}\) OPE 0.148*** (0.000) BusF \(\:\text{x}\) OPE 0.151*** (0.000) InvF \(\:\text{x}\) OPE 0.139*** (0.000) Trade 0.087 (0.135) 0.099 (0.117) 0.111 (0.108) 0.104 (0.119) 0.076 (0.163) Financial development 0.144*** (0.000) 0.129*** (0.000) 0.152*** (0.000) 0.122** (0.018) 0.135*** (0.001) Rule of law 0.166*** (0.000) 0.151*** (0.000) 0.149*** (0.000) 0.166*** (0.000) 0.173*** (0.000) Constant 0.289*** (0.000) 0.196*** (0.000) 0.328*** (0.000) 0.536*** (0.000) 0.407*** (0.000) Note : Columns 1 and include the digitalization indicators (including E-governance and ICT use), and columns 3 to 5 include the entrepreneurial governance indicators (including government integrity, business freedom, and investment freedom). ***p < 0.1, **p < 0.05, and *p < 0.01. Table 7 Results of the Indirect Effects of Necessity Entrepreneurship on Economic Sustainability. Dependent variable: Economic Sustainability Necessity entrepreneurship (NPE) Digital Infrastructure Entrepreneurial governance 1 2 3 4 5 EGDI \(\:\text{x}\) NCE 0.058 (0.179) ICT \(\:\text{x}\) NCE 0.070 (0.143) GovI \(\:\text{x}\) NCE 0.099** (0.012) BusF \(\:\text{x}\) NCE 0.106*** (0.002) InvF \(\:\text{x}\) NCE 0.093 (0.100) Trade 0.120 (0.102) 0.107 (0.117) 0.093 (0.126) 0.101 (0.137) 0.090 (0.104) Financial development 0.110** (0.028) 0.126*** (0.000) 0.114** (0.040) 0.139*** (0.000) 0.129*** (0.000) Rule of law 0.144*** (0.000) 0.150*** (0.000) 0.139*** (0.000) 0.152*** (0.000) 0.162*** (0.000) Constant 0.644*** (0.000) 0.593*** (0.000) 0.628*** (0.000) 0.477*** (0.000) 0.387*** (0.000) Note : Columns 1 and include the digitalization indicators (including E-governance and ICT use), and columns 3 to 5 include the entrepreneurial governance indicators (including government integrity, business freedom, and investment freedom). ***p < 0.1, **p < 0.05, and *p < 0.01. Table 8 Results of the indirect effects of total early-stage entrepreneurship on economic sustainability. Dependent variable: Economic Sustainability Total early-stage entrepreneurship (TEA) Digital Infrastructure Entrepreneurial governance 1 2 3 4 5 EGDI \(\:\text{x}\) TEA 0.130*** (0.000) ICT \(\:\text{x}\) TEA 0.121** (0.025) GovI \(\:\text{x}\) TEA 0.119* (0.050) BusF \(\:\text{x}\) TEA 0.133*** (0.000) InvF \(\:\text{x}\) TEA 0.129** (0.016) Trade 0.080 (0.122) 0.117** (0.023) 0.102 (0.129) 0.113 (0.103) 0.084 (0.117) Financial development 0.149*** (0.000) 0.129*** (0.000) 0.124** (0.029) 0.119** (0.014) 0.130*** (0.000) Rule of law 0.170*** (0.000) 0.155*** (0.000) 0.161*** (0.000) 0.159*** (0.000) 0.144*** (0.000) Constant 0.337*** (0.000) 0.409*** (0.000) 0.322*** (0.000) 0.503*** (0.000) 0.440*** (0.000) Note : Columns 1 and include the digitalization indicators (including E-governance and ICT use), and columns 3 to 5 include the entrepreneurial governance indicators (including government integrity, business freedom, and investment freedom). ***p < 0.1, **p < 0.05, and *p < 0.01. Turning to total early-stage entrepreneurial activity (TEA), Table 5 previously reported no statistically significant effects across all specifications, with coefficients ranging from 0.069 to 0.104. However, the interaction results in Table 8 highlight that the introduction of moderating variables leads to substantial and statistically significant improvements in TEA’s contribution to economic sustainability. Specifically, when TEA interacts with digital infrastructure, the results become both robust and significant: EGDI × TEA produces a coefficient of 0.130, while ICT × TEA yields 0.121. These findings demonstrate that, although TEA may not inherently lead to economic sustainability, its effectiveness dramatically improves in digitally connected environments. The empirical support from Hussain et al. ( 2024 ) and Schade and Schuhmacher ( 2022 ) reinforces this notion by showing that digitalization enhances entrepreneurial capabilities and innovation performance, which are essential for sustainable growth. Similarly, the role of entrepreneurial governance proves pivotal. The interaction between TEA and government integrity is positive and statistically significant at 0.119, business freedom at 0.133, and investment freedom at 0.129. These values exceed the direct effects reported in Table 5 , indicating that the institutional environment enhances TEA's effectiveness in achieving sustainable economic outcomes. These results substantiate the theoretical claims of North ( 1990 ) and Scott ( 1995 ), who argue that institutional settings shape entrepreneurial efficacy by providing a stable and predictable environment for business operations. Moreover, these findings are echoed in the empirical results of Olsson et al. ( 2020 ), who highlight that local entrepreneurial governance systems in Sweden contribute to employment growth and regional resilience. Therefore, while TEA in isolation may lack a strong influence, it becomes a key driver of sustainability when supported by the dual enablers of governance and digital infrastructure, thereby fulfilling the theoretical premise of resource-based and institutional theories. To summarize, as shown in Figs. 2 and 3 , the interaction models emphasize the significance of contextual enablers—specifically, digital infrastructure and entrepreneurial governance—in influencing the effectiveness of entrepreneurial activity in promoting economic sustainability. Opportunity entrepreneurship, which already exhibits a positive impact, is significantly amplified in the presence of these moderators. Necessity entrepreneurship, though inherently negative in its direct influence, can be rehabilitated through strong governance mechanisms, highlighting the adaptive role of institutions in steering informal or survivalist enterprises toward productive outcomes. Meanwhile, TEA, initially insignificant in its direct effect, becomes economically meaningful when supported by both technological and institutional infrastructures. These findings collectively demonstrate that entrepreneurship does not operate in a vacuum; rather, its contribution to sustainable development is highly contingent upon the quality of the surrounding ecosystem. This supports the multidimensional argument that sustainable entrepreneurship is both a function of individual agency and structural context. Therefore, policymakers in emerging economies aiming to harness entrepreneurship as a catalyst for sustainability must prioritize investments in digital infrastructure and institutional reform. Such efforts will not only maximize the developmental impact of entrepreneurship but also foster inclusive, resilient, and sustainable growth trajectories that are responsive to the challenges of the 21st century. 5. Conclusion and implications This study aimed to investigate the role of entrepreneurship in promoting economic sustainability in emerging economies and to examine the extent to which this contribution is influenced by digital infrastructure and entrepreneurial governance. Drawing on theoretical underpinnings from the Resource-Based Theory and Institutional Theory, the research focused on identifying the conditional impact of three distinct forms of entrepreneurship—opportunity-driven, necessity-driven, and total early-stage entrepreneurial activity—on economic sustainability. The empirical analysis was based on a balanced panel of 16 emerging economies spanning the period from 2004 to 2021. The methodology employed interaction models to explore the moderating influence of key institutional and technological factors—specifically, digital infrastructure (measured by EGDI and ICT access) and entrepreneurial governance (proxied by government integrity, business freedom, and investment freedom). By incorporating these interactions, the study aimed to elucidate the transmission mechanisms through which entrepreneurship influences long-term economic sustainability under varying contextual conditions. The results demonstrate that opportunity-driven entrepreneurship is a significant driver of economic sustainability in emerging economies, particularly when supported by high-quality digital infrastructure and effective governance structures. These enabling conditions enhance the effectiveness of entrepreneurial activities by facilitating market access, reducing transaction costs, and enhancing institutional trust. In contrast, necessity-driven entrepreneurship exhibits a negative direct effect on economic sustainability; however, this adverse influence can be mitigated through robust entrepreneurial governance. Notably, digital infrastructure alone does not sufficiently moderate the negative impact of necessity entrepreneurship, emphasizing the central role of governance reforms in shifting necessity-based ventures toward more sustainable economic outcomes. Furthermore, total early-stage entrepreneurial activity, which displayed no significant direct effect on sustainability in the base models, becomes positively significant when contextualized through digital and governance moderators. This suggests that the broader entrepreneurial environment—particularly the quality of digital and institutional infrastructures—determines whether entrepreneurial activity results in sustainable economic benefits. The findings carry significant policy and practical implications for stakeholders seeking to enhance the sustainability outcomes of entrepreneurship in emerging economies. First, investment in digital infrastructure should be a national priority. Governments must expand broadband coverage, mobile penetration, and ICT accessibility to foster an inclusive digital ecosystem. Such investments can lower entry barriers, facilitate the diffusion of innovation, and enable resource-poor entrepreneurs to leverage digital tools for business scalability and market integration. Policymakers should also promote public-private partnerships to develop smart infrastructure and digital literacy programs, particularly in underserved and rural areas, where opportunity-driven entrepreneurship can have a transformative impact. Second, entrepreneurial governance reforms are essential. Governments must streamline regulatory frameworks, reduce bureaucratic red tape, and enhance the predictability and transparency of business-related procedures. Improving the rule of law, curbing corruption, and safeguarding property rights are equally vital to building investor and entrepreneurial confidence. Specific policies that incentivize business formalization, such as tax incentives, start-up support centers, and fast-track licensing schemes, should be implemented. Entrepreneurial governance should also encompass institutional frameworks that foster inclusive entrepreneurship, encouraging youth, women, and marginalized groups to participate in innovation-driven ventures. Third, it is essential to adopt a systems-thinking approach by designing policy interventions that simultaneously strengthen both digital and governance infrastructures. For instance, integrated e-governance platforms that combine digital service delivery with regulatory simplification can enhance the quality of the business environment while leveraging technology. Additionally, capacity-building programs focused on entrepreneurial competencies, digital marketing, and innovation management can ensure that emerging entrepreneurs have the skills needed to thrive in evolving ecosystems. Development agencies and educational institutions should collaborate to foster entrepreneurial mindsets that align with the Sustainable Development Goals. Ultimately, empirical monitoring systems should be institutionalized to track the effectiveness of these interventions, allowing for adaptive policy adjustments based on real-time evidence and stakeholder feedback. This study has several limitations that suggest avenues for future research. The results may not generalize beyond the 16 emerging economies analyzed. Additionally, other potential moderators—such as education, finance, or environmental regulation—were omitted. The study's aggregate-level, quantitative approach limits insights into sectoral, informal, or micro-level entrepreneurial dynamics. Future studies should explore these aspects using mixed methods and broader samples. Investigating how the effects evolve over time or in response to external shocks (e.g., pandemics or climate crises) would also provide valuable insights. Addressing these gaps can improve policy design and enhance the role of entrepreneurship in sustainable development. Declarations Ethics Statement This article does not contain any studies with human participants performed by any of the authors. Funding: This research received no external funding. Author Contribution Faisal Alfehaid: Conceptualization, Formal analysis, Methodology, Writing – original draft, Visualization, and Investigation.Anis Omri (Corresponding Author): Conceptualization, Data curation, Formal analysis, Supervision, Validation, Writing – review & editing. Data Availability The research data supporting this article are available from the authors upon reasonable request. References Abegaz MB, Debela KL, Hundie RM (2023) The effect of governance on entrepreneurship: from all income economies perspective. J Innov Entrepreneurship 12(1):1 Acs ZJ, Desai S, Hessels J (2008) Entrepreneurship, economic development and institutions. Small Bus Econ 31(3):219–234 Aidis R, Estrin S, Mickiewicz T (2008) Institutions and entrepreneurship development in Russia: A comparative perspective. J Bus Ventur 23(6):656–672 Alfehaid F, Omri A, Altwaijri A (2024) Impact of ICT diffusion and opportunity entrepreneurship on environmental sustainability in Saudi Arabia. Heliyon , 10 (19) Altwaijri A, Omri A, Alfehaid F (2024) Promoting entrepreneurship for sustainable development: Are education capital and ICT diffusion important? Sustain Dev 32(5):5463–5487 Audretsch DB, Keilbach M (2004) Entrepreneurship and regional growth: An evolutionary interpretation. J Evol Econ 14(5):605–616 Autio E, Komlósi É, Szerb L, Galambosné Tiszberger M, Park D, Jinjarak Y (2024) Digital entrepreneurship landscapes in developing Asia: insights from the Global Index of Digital Entrepreneurship Systems. Eur J Innov Manage Barney J (1991) Firm resources and sustained competitive advantage. J Manag 17(1):99–120. https://doi.org/10.1177/014920639101700108 Belz FM, Binder JK (2017) Sustainable entrepreneurship: A convergent process model. Bus Strategy Environ 26(1):1–17 Bharadwaj AS (2000) A resource-based perspective on information technology capability and firm performance: An empirical investigation. MIS Q 24(1):169–196. https://doi.org/10.2307/3250983 Bowen R, Morris W (2019) The digital divide: Implications for agribusiness and entrepreneurship. Lessons from Wales. J Rural Stud 72:75–84 Carroll JJ (2017) Failure is an option: the entrepreneurial governance framework. J Entrepreneurship Public Policy 6(1):108–126 Cervelló-Royo R, Devece C, Lull JJ (2024) Analysis of economic growth through the context conditions that allow entrepreneurship. RMS, 1–23 Coase RH (1937) The nature of the firm. Economica 4(16):386–405. https://doi.org/10.2307/2626876 Dean TJ, McMullen JS (2007) Toward a theory of sustainable entrepreneurship: Reducing environmental degradation through entrepreneurial action. J Bus Ventur 22(1):50–76 Elmonshid LBE, Sayed OA (2024) The Relationship between Entrepreneurship and Sustainable Development in Saudi Arabia: A Comprehensive Perspective. Economies 12(8):198 Estrin S, Korosteleva J, Mickiewicz T (2013) Which institutions encourage entrepreneurial growth aspirations? J Bus Ventur 28(4):564–580 Gomes S, Lopes JM (2022) ICT access and entrepreneurship in the open innovation dynamic context: Evidence from OECD countries. J Open Innovation: Technol Market Complex 8(2):102 Grandori A (2024) Entrepreneurial governance and the nature of the entrepreneurial firm. Small Bus Econ 63(4):1503–1516 Heritage Foundation (2022) Index of Economic Freedom . https://www.heritage.org/index/ Hussain H, Jun W, Radulescu M (2024) Innovation performance in the digital divide context: Nexus of digital infrastructure, digital innovation, and e-knowledge. J Knowl Econ 16:3772–3792 Khyareh MM, Zamani M (2022) Economic Freedom, Entrepreneurship And Economic Growth: Evidence From Panel Data. J Dev Entrepreneurship 27(04):2250027 Lewis WA (2013) Theory of economic growth. Routledge Li X, Yang G, Shao T, Yang D, Liu Z (2024) Does digital infrastructure promote individual entrepreneurship? Evidence from a quasi-natural experiment on the Broadband China strategy. Technol Forecast Soc Chang 206:123555 Magd H, Khan SA, Nte ND, Sarim M (2023) Entrepreneurship and economic sustainability. 1: Prestige Publishers, New Delhi, IndiaEditor: Hesham Magd, Edition Méndez-Picazo MT, Galindo-Martín MÁ, Ribeiro-Soriano D (2012) Governance, entrepreneurship and economic growth. Entrepreneurship Reg Dev 24(9–10):865–877 Neumann T (2021) The impact of entrepreneurship on economic, social and environmental welfare and its determinants: a systematic review. Manage Rev Q 71(3):553–584 North DC (1990) Institutions, institutional change and economic performance. Cambridge University Press Olsson AR, Westlund H, Larsson JP (2020) Entrepreneurial governance and local growth. Sustainability 12(9):3857 Ordeñana X, Vera-Gilces P, Zambrano-Vera J, Jiménez A (2024) The effect of high-growth and innovative entrepreneurship on economic growth. J Bus Res 171:114243 Poschke M (2013) Entrepreneurs out of necessity: A snapshot. Appl Econ Lett 20(7):658–663 Raimi L (2024) The Role of Entrepreneurship as Catalysts for Sustainability and a Green, Resilient Economy. Emerald Publishing Raimi L, Haini H (2024) Impact of entrepreneurial governance and ease of doing business on economic growth: Evidence from ECOWAS economies. J Public Affairs, 24(1), e2887 Reynolds P, Bosma N, Autio E, Hunt S, De Bono N, Servais I, Chin N (2005) Global entrepreneurship monitor: Data collection design and implementation 1998–2003. Small Bus Econ 24(3):205–231 Schade P, Schuhmacher MC (2022) Digital infrastructure and entrepreneurial action-formation: A multilevel study. J Bus Ventur 37(5):106232 Schumpeter JA (1934) The Theory of Economic Development Scott WR (1995) Institutions and organizations. Sage, Thousand Oaks, CA Scott WR (2001) Institutions and organizations: Ideas, interests, and identities, 2nd edn. Sage, Thousand Oaks, CA Toma SG, Grigore AM, Marinescu P (2014) Economic development and entrepreneurship. Procedia Econ finance 8:436–443 United Nations (2020) E-Government Survey 2020: Digital Government in the Decade of Action for Sustainable Development. Department of Economic and Social Affairs van Stel A, Carree M, Thurik R (2005) The effect of entrepreneurial activity on national economic growth. Small Bus Econ 24(3):311–321 Wang S, Song Y, Du AM, Liang J (2024) The digital economy and entrepreneurial dynamics: An empirical analysis of urban regions in China. Res Int Bus Finance 71:102459 Wei B, Zhao C, Cai W, Chen B, Lu Y (2024) The entrepreneurial effect of digital infrastructure development: micro evidence from China. Inform Technol Dev 31(3):1–31 Wernerfelt B (1984) A resource-based view of the firm. Strateg Manag J 5(2):171–180. https://doi.org/10.1002/smj.4250050207 Williamson OE (1981) The economics of organization: The transaction cost approach. Am J Sociol 87(3):548–577. https://doi.org/10.1086/227496 Wu W, Wang S, Jiang X, Zhou J (2023) Regional digital infrastructure, enterprise digital transformation and entrepreneurial orientation: Empirical evidence based on the broadband China strategy. Inf Process Manag 60(5):103419 Xiong C, Liang Y, Zhang B (2024) Digital infrastructure and urban entrepreneurship level. Appl Econ Lett, 1–8 Xu A, Li P, Xin X (2024) The Impact of Digital Governance on Entrepreneurial Activity in Relatively Poor Areas: Evidence from Tibet, China. Sustainability 16(17):7247 Yin Z, Gong X, Guo P, Wu T (2019) What drives entrepreneurship in digital economy? Evidence from China. Econ Model 82:66–73 Yusuf N, Albanawi NI (2016) The role of entrepreneurship in economic development in Saudi Arabia. Bus Econ J 7:1–5 Additional Declarations No competing interests reported. Cite Share Download PDF Status: Posted Version 1 posted You are reading this latest preprint version Research Square lets you share your work early, gain feedback from the community, and start making changes to your manuscript prior to peer review in a journal. As a division of Research Square Company, we’re committed to making research communication faster, fairer, and more useful. We do this by developing innovative software and high quality services for the global research community. Our growing team is made up of researchers and industry professionals working together to solve the most critical problems facing scientific publishing. Also discoverable on Platform About Our Team In Review Editorial Policies Advisory Board Help Center Resources Author Services Accessibility API Access RSS feed Manage Cookie Preferences © Research Square 2026 | ISSN 2693-5015 (online) Privacy Policy Terms of Service Do Not Sell My Personal Information {"props":{"pageProps":{"initialData":{"identity":"rs-7796316","acceptedTermsAndConditions":true,"allowDirectSubmit":true,"archivedVersions":[],"articleType":"Article","associatedPublications":[],"authors":[{"id":559893296,"identity":"93e3a3d2-0eed-48c2-9641-23358cddb1d8","order_by":0,"name":"Faisal Alfehaid","email":"","orcid":"","institution":"Qassim University","correspondingAuthor":false,"prefix":"","firstName":"Faisal","middleName":"","lastName":"Alfehaid","suffix":""},{"id":559893297,"identity":"ef5cc5e8-f9ec-4d65-b59e-3825de2545e4","order_by":1,"name":"Anis Omri","email":"data:image/png;base64,iVBORw0KGgoAAAANSUhEUgAAAZAAAAAyAQMAAABI0h/eAAAABlBMVEX///8AAABVwtN+AAAACXBIWXMAAA7EAAAOxAGVKw4bAAAAuUlEQVRIiWNgGAWjYNACAxswJUGKljSStTAcJkELfwPz0c0VBedlNxxgPnibh6FOnqAWiQNsaTfPGNw23nCALdmah+GwYQNBPQd4zG42GNxO3ABkSPMwHGAkqEUeouUcUAv/N6CWOnuCWgwgWg6AbGEDamFOJKjF8DDQLw0GycYzD7MZW84xOJxMUIvc8eZjNxv+2Mn2HW9+eONNRZ0tQS0MzBCKsQHMMCCoHgEIB9QoGAWjYBSMXAAAIPE6YIA0ayoAAAAASUVORK5CYII=","orcid":"","institution":"Qassim University","correspondingAuthor":true,"prefix":"","firstName":"Anis","middleName":"","lastName":"Omri","suffix":""}],"badges":[],"createdAt":"2025-10-07 06:23:17","currentVersionCode":1,"declarations":"","doi":"10.21203/rs.3.rs-7796316/v1","doiUrl":"https://doi.org/10.21203/rs.3.rs-7796316/v1","draftVersion":[],"editorialEvents":[],"editorialNote":"","failedWorkflow":false,"files":[{"id":98436760,"identity":"ed68fcbc-6a08-438b-9d03-5e300afd17e1","added_by":"auto","created_at":"2025-12-17 16:56:13","extension":"docx","order_by":0,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":457889,"visible":true,"origin":"","legend":"","description":"","filename":"BlindedManuscript.docx","url":"https://assets-eu.researchsquare.com/files/rs-7796316/v1/1d05a498140e795c09a20fe8.docx"},{"id":98303146,"identity":"46f1e456-31f4-4568-9777-8a25ba35f7c2","added_by":"auto","created_at":"2025-12-16 10:37:39","extension":"json","order_by":1,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":4423,"visible":true,"origin":"","legend":"","description":"","filename":"c9a68956062c47609fac2b5eacb60dcb.json","url":"https://assets-eu.researchsquare.com/files/rs-7796316/v1/21ca9d5b0c169fd3532ae790.json"},{"id":98435668,"identity":"ee6317b2-9515-4111-a090-50418d1350bc","added_by":"auto","created_at":"2025-12-17 16:54:11","extension":"xml","order_by":2,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":189981,"visible":true,"origin":"","legend":"","description":"","filename":"c9a68956062c47609fac2b5eacb60dcb1enriched.xml","url":"https://assets-eu.researchsquare.com/files/rs-7796316/v1/09088400ad59401ddd5a0f84.xml"},{"id":98303149,"identity":"c0c05c84-555d-4297-94ca-7062139ab48c","added_by":"auto","created_at":"2025-12-16 10:37:39","extension":"jpeg","order_by":5,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":1074,"visible":true,"origin":"","legend":"","description":"","filename":"floatimage3.jpeg","url":"https://assets-eu.researchsquare.com/files/rs-7796316/v1/30a315ee9543dc0057aa44e2.jpeg"},{"id":98303148,"identity":"4033955b-af50-4ded-a62b-4e81dbb30df1","added_by":"auto","created_at":"2025-12-16 10:37:39","extension":"jpeg","order_by":7,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":1074,"visible":true,"origin":"","legend":"","description":"","filename":"floatimage3.jpeg","url":"https://assets-eu.researchsquare.com/files/rs-7796316/v1/d9f27708e48dff9d37d76cb4.jpeg"},{"id":98303155,"identity":"19fd7539-ac1d-43c5-b289-3d001e56ed8c","added_by":"auto","created_at":"2025-12-16 10:37:39","extension":"png","order_by":8,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":16788,"visible":true,"origin":"","legend":"","description":"","filename":"Onlinefloatimage1.png","url":"https://assets-eu.researchsquare.com/files/rs-7796316/v1/c8265cae1323e4ad881d197f.png"},{"id":98436632,"identity":"97fe501b-dcd4-4ae0-bbaa-df0ad525e715","added_by":"auto","created_at":"2025-12-17 16:56:00","extension":"png","order_by":9,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":59250,"visible":true,"origin":"","legend":"","description":"","filename":"Onlinefloatimage2.png","url":"https://assets-eu.researchsquare.com/files/rs-7796316/v1/2559f2c0a9dd39ec79098ff2.png"},{"id":98303153,"identity":"53e79e1c-3b5c-499e-ab53-398afd354e06","added_by":"auto","created_at":"2025-12-16 10:37:39","extension":"png","order_by":10,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":935,"visible":true,"origin":"","legend":"","description":"","filename":"Onlinefloatimage3.png","url":"https://assets-eu.researchsquare.com/files/rs-7796316/v1/7f2b1015c3af312f6337f141.png"},{"id":98435213,"identity":"5b5535f2-3b1d-4d6d-97d1-73c544cd1068","added_by":"auto","created_at":"2025-12-17 16:53:19","extension":"png","order_by":11,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":57427,"visible":true,"origin":"","legend":"","description":"","filename":"Onlinefloatimage4.png","url":"https://assets-eu.researchsquare.com/files/rs-7796316/v1/dba5be817f80f9e2817c70c4.png"},{"id":98436394,"identity":"33a8a4df-9ddc-486a-b666-8f4843065f9c","added_by":"auto","created_at":"2025-12-17 16:55:37","extension":"png","order_by":12,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":935,"visible":true,"origin":"","legend":"","description":"","filename":"Onlinefloatimage3.png","url":"https://assets-eu.researchsquare.com/files/rs-7796316/v1/c0782febb4a5f3182a486783.png"},{"id":98303160,"identity":"0df523d4-8f4f-4087-95e0-ac04e00a273c","added_by":"auto","created_at":"2025-12-16 10:37:39","extension":"xml","order_by":13,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":188586,"visible":true,"origin":"","legend":"","description":"","filename":"c9a68956062c47609fac2b5eacb60dcb1structuring.xml","url":"https://assets-eu.researchsquare.com/files/rs-7796316/v1/f192d863ad01c73b69b04167.xml"},{"id":98303159,"identity":"14ca9566-907d-4dde-8ddf-7204db3d572e","added_by":"auto","created_at":"2025-12-16 10:37:39","extension":"html","order_by":14,"title":"","display":"","copyAsset":false,"role":"acdc-reference","size":198566,"visible":true,"origin":"","legend":"","description":"","filename":"earlyproof.html","url":"https://assets-eu.researchsquare.com/files/rs-7796316/v1/5779a3dab4f46747edf7f15f.html"},{"id":98435862,"identity":"4cb7bb1d-43f7-434e-9c55-3a02a54fb5bd","added_by":"auto","created_at":"2025-12-17 16:54:32","extension":"png","order_by":1,"title":"Figure 1","display":"","copyAsset":false,"role":"figure","size":50159,"visible":true,"origin":"","legend":"\u003cp\u003eTheoretical model of the study.\u003c/p\u003e","description":"","filename":"floatimage139.png","url":"https://assets-eu.researchsquare.com/files/rs-7796316/v1/201748932c8f49343990e540.png"},{"id":98437018,"identity":"076d243d-ec6a-4b50-ab3d-303946d27f4f","added_by":"auto","created_at":"2025-12-17 16:56:46","extension":"jpeg","order_by":2,"title":"Figure 2","display":"","copyAsset":false,"role":"figure","size":349402,"visible":true,"origin":"","legend":"\u003cp\u003eImpact of Entrepreneurial Governance and Entrepreneurship on Economic Sustainability.\u003c/p\u003e","description":"","filename":"floatimage2.jpeg","url":"https://assets-eu.researchsquare.com/files/rs-7796316/v1/8310b3694d25f11b57bd05a5.jpeg"},{"id":98435170,"identity":"a0350273-da0d-4d02-9ab6-46d9274d5e19","added_by":"auto","created_at":"2025-12-17 16:53:14","extension":"jpeg","order_by":3,"title":"Figure 3","display":"","copyAsset":false,"role":"figure","size":324105,"visible":true,"origin":"","legend":"\u003cp\u003eImpact of Digital Infrastructure and Entrepreneurship on Economic Sustainability.\u003c/p\u003e","description":"","filename":"floatimage4.jpeg","url":"https://assets-eu.researchsquare.com/files/rs-7796316/v1/aec89ec87a7e6d0379e830b6.jpeg"},{"id":99683741,"identity":"99e63a1a-8408-4c06-85aa-8d4df0f1b5ac","added_by":"auto","created_at":"2026-01-07 09:09:40","extension":"pdf","order_by":0,"title":"","display":"","copyAsset":false,"role":"manuscript-pdf","size":1968735,"visible":true,"origin":"","legend":"","description":"","filename":"manuscript.pdf","url":"https://assets-eu.researchsquare.com/files/rs-7796316/v1/66c645d5-5c98-4ec9-8369-127904b74b32.pdf"}],"financialInterests":"No competing interests reported.","formattedTitle":"Empowering Sustainable Entrepreneurship: How Governance and Digital Infrastructure Reframe Entrepreneurial Outcomes?","fulltext":[{"header":"1. Introduction","content":"\u003cp\u003eAchieving economic sustainability in emerging economies presents profound and multifaceted challenges. These countries often face structural vulnerabilities, including low industrial diversification, excessive reliance on volatile commodity exports, and persistent macroeconomic instability. Additionally, barriers such as weak governance, bureaucratic inefficiencies, corruption, and limited access to finance hinder the development of inclusive and resilient economic systems. As highlighted by Cervell\u0026oacute;-Royo et al. (\u003cspan citationid=\"CR13\" class=\"CitationRef\"\u003e2024\u003c/span\u003e), macroeconomic stability, investment freedom, and sound regulatory frameworks are crucial for fostering entrepreneurship and promoting sustainable growth in regions such as Latin America. Without these conditions, many emerging economies remain trapped in cycles of stagnation, unemployment, and underdevelopment. The adverse impact of institutional rigidity and social exclusion, particularly on youth and marginalized groups, has also been emphasized by Raimi (\u003cspan citationid=\"CR33\" class=\"CitationRef\"\u003e2024\u003c/span\u003e), who warns that unequal access to resources can undermine sustainability efforts and limit the transformative capacity of entrepreneurship. Entrepreneurship has emerged as a vital mechanism for promoting economic sustainability within this context. Schumpeter\u0026rsquo;s (\u003cspan citationid=\"CR36\" class=\"CitationRef\"\u003e1934\u003c/span\u003e) foundational theory conceptualized the entrepreneur as a dynamic agent of \"creative destruction,\" introducing innovations that disrupt and revitalize existing economic systems. This view remains central to contemporary understandings of entrepreneurship\u0026rsquo;s role in advancing productivity, structural transformation, and technological progress. According to Raimi (\u003cspan citationid=\"CR33\" class=\"CitationRef\"\u003e2024\u003c/span\u003e), entrepreneurship not only fosters innovation but also enables economies to respond to ecological constraints and structural challenges through adaptive, sustainable systems. These systems are especially valuable in resource-scarce and institutionally fragile settings. Elmonshid and Sayed (\u003cspan citationid=\"CR16\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) further reinforce this perspective in their examination of Saudi Arabia\u0026rsquo;s Vision 2030, where entrepreneurship contributes to job creation, gender equity, and green economic transformation\u0026mdash;pillars that align with the broader objectives of the United Nations Sustainable Development Goals (SDGs). Thus, entrepreneurship serves as a strategic enabler in a rapidly changing global economic landscape, catalyzing inclusive and environmentally sound growth in emerging markets.\u003c/p\u003e \u003cp\u003eA substantial body of empirical literature supports the claim that entrepreneurship enhances economic sustainability. Studies such as those by Magd et al. (\u003cspan citationid=\"CR25\" class=\"CitationRef\"\u003e2023\u003c/span\u003e) and Orde\u0026ntilde;ana et al. (\u003cspan citationid=\"CR30\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) demonstrate a positive correlation between entrepreneurial activity and national development indicators, including innovation performance, economic diversification, and employment generation. Magd et al. (\u003cspan citationid=\"CR25\" class=\"CitationRef\"\u003e2023\u003c/span\u003e) demonstrate bi-directional causality between entrepreneurship and economic performance across more than 100 countries, highlighting a reinforcing development cycle. Orde\u0026ntilde;ana et al. (\u003cspan citationid=\"CR30\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) also differentiate between types of entrepreneurial activities, noting that innovation-driven ventures contribute more significantly to sustainable growth. These insights suggest that entrepreneurship is not a monolithic concept; its impact varies depending on the enabling environment and institutional support. Despite these advancements, the literature reveals critical gaps. In particular, limited attention has been given to the mechanisms through which entrepreneurship fosters economic sustainability. While general associations have been confirmed, the exact pathways\u0026mdash;especially in the context of emerging economies\u0026mdash;require further scrutiny. Two mechanisms stand out in the literature for their strategic relevance and underexplored potential: entrepreneurial governance and digital infrastructure. Entrepreneurial governance refers to institutional arrangements and governance systems that support transparency, innovation, and inclusivity in entrepreneurial activities. Grandori (\u003cspan citationid=\"CR19\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) describes this mode as a hybrid system distinct from conventional capitalist or collectivist frameworks, emphasizing adaptive organizational forms and normative alignment with public policy. Raimi and Haini (\u003cspan citationid=\"CR33\" class=\"CitationRef\"\u003e2024\u003c/span\u003e), in their study on ECOWAS countries, find strong correlations between normative governance elements (such as business freedom and government integrity) and entrepreneurial-driven economic growth.\u003c/p\u003e \u003cp\u003eSimilarly, digital infrastructure\u0026mdash;comprising broadband access, mobile technologies, and digital platforms\u0026mdash;serves as a critical enabler of sustainable entrepreneurship. Rooted in the Resource-Based Theory (Barney, \u003cspan citationid=\"CR8\" class=\"CitationRef\"\u003e1991\u003c/span\u003e; Wernerfelt, \u003cspan citationid=\"CR44\" class=\"CitationRef\"\u003e1984\u003c/span\u003e), digital infrastructure is seen as a strategic resource that fosters access to information, reduces transaction costs, and enables business scalability. Li et al. (\u003cspan citationid=\"CR24\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) show that digital environments in China significantly stimulate individual entrepreneurship by providing flexible workspaces and better market insights. Schade and Schuhmacher (\u003cspan citationid=\"CR35\" class=\"CitationRef\"\u003e2022\u003c/span\u003e) reinforce this by identifying digital tools as \"external enablers\" that enhance self-efficacy and opportunity recognition. Yet, in much of the existing literature, these mechanisms are either considered in isolation or insufficiently integrated into broader analyses of entrepreneurship and sustainability. This study addresses this gap by systematically evaluating how entrepreneurial governance and digital infrastructure interact to mediate the effects of entrepreneurship on economic sustainability in emerging markets.\u003c/p\u003e \u003cp\u003eTo fill the identified gaps in the literature, this study investigates the roles of entrepreneurial governance and digital infrastructure as mediating mechanisms through which entrepreneurship contributes to economic sustainability. The research focuses on 16 emerging economies over 18 years (2004\u0026ndash;2021), allowing for the observation of long-term trends and structural shifts. Drawing from cross-national panel data, the study examines how variations in governance quality and digital readiness influence the impact of entrepreneurship on economic resilience and development. This design accounts for institutional heterogeneity and offers a robust empirical foundation for generalizing findings across different emerging market contexts. The study makes several key contributions to the literature. First, it advances the theoretical integration of institutional and technological enablers into the entrepreneurship-sustainability nexus. By positioning entrepreneurial governance and digital infrastructure as mediators, it transcends traditional models that view entrepreneurship as a uniform driver of growth. Second, it provides a comprehensive empirical analysis grounded in both institutional theory (Scott, \u003cspan citationid=\"CR37\" class=\"CitationRef\"\u003e1995\u003c/span\u003e; North, \u003cspan citationid=\"CR28\" class=\"CitationRef\"\u003e1990\u003c/span\u003e) and the Resource-Based View (Barney, \u003cspan citationid=\"CR8\" class=\"CitationRef\"\u003e1991\u003c/span\u003e), offering new insights into how governance and infrastructure shape entrepreneurial ecosystems. Third, the study enhances practical policy relevance by identifying levers, such as regulatory quality, broadband access, and anti-corruption measures, that can amplify entrepreneurship\u0026rsquo;s sustainability outcomes. For example, Xu et al. (\u003cspan citationid=\"CR48\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) demonstrate that digital governance in rural regions, such as Tibet, enhances administrative efficiency and expands market access, thereby encouraging entrepreneurial participation. Finally, the study contributes to a growing body of literature advocating for context-specific development models, particularly those that empower local entrepreneurs as agents of sustainable transformation.\u003c/p\u003e \u003cp\u003eThe article is structured into four sections: a literature review examining the theoretical and empirical foundations; a data and methodology section detailing the econometric framework and data sources; a results and discussion section analyzing the empirical findings; and a conclusion highlighting key results, theoretical contributions, and policy implications.\u003c/p\u003e"},{"header":"2. Literature review","content":"\u003cdiv id=\"Sec3\" class=\"Section2\"\u003e \u003ch2\u003e2.1. Entrepreneurship and economic sustainability\u003c/h2\u003e \u003cp\u003eThe significance of entrepreneurship in economic development is firmly grounded in classical economic growth theories. Notably, Schumpeter (\u003cspan citationid=\"CR36\" class=\"CitationRef\"\u003e1934\u003c/span\u003e) emphasized the entrepreneur as a central agent of \"creative destruction,\" introducing innovation and restructuring existing economic systems, which is critical to sustaining long-term growth. This Schumpeterian view remains foundational in understanding how entrepreneurial activities drive technological advancement, productivity, and institutional evolution. Modern extensions of growth theory, including endogenous models, align with this perspective, asserting that innovation and human capital\u0026mdash;often fostered through entrepreneurial initiatives\u0026mdash;are engines of sustained economic performance. Within this framework, entrepreneurship is not merely a response to opportunity, but a transformative force that reshapes economies toward greater sustainability. Raimi (\u003cspan citationid=\"CR33\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) affirms that entrepreneurship is vital for a green and resilient economy, functioning as a mechanism for resource efficiency and environmental stability through strategic innovation. He emphasizes that entrepreneurship responds to ecological and structural challenges by creating adaptive systems that can thrive even in resource-scarce settings. Magd et al. (\u003cspan citationid=\"CR25\" class=\"CitationRef\"\u003e2023\u003c/span\u003e) empirically reinforce these findings using data from over 100 countries, demonstrating that entrepreneurial ecosystems and economic development are interdependent. Their bi-directional causality model reveals that as entrepreneurship expands, economic performance indicators improve, while a growing economy simultaneously nurtures more entrepreneurial ventures. This virtuous cycle suggests that entrepreneurship and economic sustainability are inherently linked through systemic reinforcement.\u003c/p\u003e \u003cp\u003eThe practical implementation of entrepreneurship as a vehicle for sustainable development is evident in national strategies, such as Saudi Arabia's Vision 2030. Elmonshid and Sayed (\u003cspan citationid=\"CR16\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) illustrate that entrepreneurship within this framework drives economic diversification, job creation, and innovation\u0026mdash;all critical pillars of economic sustainability. Their study reveals how entrepreneurial activity enhances not only economic output but also gender equity, youth employment, and environmentally responsible practices. These results closely resonate with the objectives set forth by the United Nations SDGs, thereby strengthening the premise that entrepreneurship is pivotal in fostering expansive and inclusive economic growth. Orde\u0026ntilde;ana et al. (\u003cspan citationid=\"CR30\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) found that creative entrepreneurship, particularly in product development, technical integration, and export orientation, has a considerable impact on national economic growth. Their findings differentiate between types of entrepreneurship, suggesting that innovation-intensive ventures yield the most substantial benefits for long-term sustainability. These insights suggest that entrepreneurship is most effective when integrated into coherent macroeconomic strategies and supported by institutional alignment, facilitating both economic diversification and structural transformation.\u003c/p\u003e \u003cp\u003eNevertheless, the actualization of entrepreneurship's comprehensive potential in fostering economic sustainability is accompanied by significant challenges. Institutional barriers, including regulatory inefficiencies, limited access to financial resources, and socio-cultural constraints, can hinder inclusive and equitable entrepreneurial development. Raimi (\u003cspan citationid=\"CR33\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) warns that imbalanced power dynamics and institutional rigidities may hinder entrepreneurship's ability to contribute holistically to sustainability, potentially reinforcing social exclusion. This calls for a deliberate policy orientation that fosters inclusive entrepreneurship, especially among marginalized groups. According to Cervell\u0026oacute;-Royo et al. (\u003cspan citationid=\"CR13\" class=\"CitationRef\"\u003e2024\u003c/span\u003e), the efficiency of entrepreneurship as a driver of economic growth is heavily influenced by current macroeconomic stability and regulatory settings. Their findings from Latin America suggest that economic growth is accelerated when entrepreneurial activity is supported by investment freedom, moderate inflation, and low tax burdens. Khyareh and Zamani (\u003cspan citationid=\"CR22\" class=\"CitationRef\"\u003e2022\u003c/span\u003e) note that the institutional environment, particularly economic freedom and market openness, has a significant influence on the magnitude of entrepreneurship's contribution to economic growth. In economies with greater freedom and supportive regulatory frameworks, entrepreneurship not only flourishes but also becomes a powerful tool for fostering economic resilience and sustainability. Similarly, Yusuf and Albanawi (\u003cspan citationid=\"CR50\" class=\"CitationRef\"\u003e2016\u003c/span\u003e) reinforce that entrepreneurship is a driver of productivity and national competitiveness when aligned with long-term development strategies. Classical theories, such as those by Lewis (\u003cspan citationid=\"CR23\" class=\"CitationRef\"\u003e2013\u003c/span\u003e), also support this view, indicating that sustainable output growth is driven by institutions that facilitate entrepreneurship and innovation. The results presented align with the conclusions drawn by Toma et al. (\u003cspan citationid=\"CR39\" class=\"CitationRef\"\u003e2014\u003c/span\u003e), who assert that entrepreneurial endeavors exhibit a dynamic reaction to technological upheavals and fluctuations in the global economy, thereby positioning it as a robust approach for promoting sustainable development. Neumann (\u003cspan citationid=\"CR27\" class=\"CitationRef\"\u003e2021\u003c/span\u003e) similarly delineates the complex influence of entrepreneurship on economic, social, and environmental well-being, concluding that its net positive effect is significantly contingent upon institutional and contextual factors. These determinants\u0026mdash;education, access to finance, regulatory efficiency, and digital infrastructure\u0026mdash;form the foundation of robust entrepreneurial ecosystems. Thus, the consistent theme across the literature is that while entrepreneurship is a powerful engine of sustainability, its effectiveness is significantly enhanced by enabling ecosystems and supportive public policy.\u003c/p\u003e \u003cp\u003eConsidering the extensive body of empirical and theoretical research, it is justifiable to infer that entrepreneurial endeavors make a significant contribution to promoting economic sustainability. The literature examined consistently indicates that entrepreneurial activities facilitate not merely immediate economic expansion but also foster the enduring stability and resilience of economies via mechanisms of innovation, diversification, and social inclusivity. Entrepreneurship fosters dynamic ecosystems that respond effectively to environmental challenges, generate employment, and promote inclusive development across diverse economic contexts. It operates as both a mechanism for economic renewal and a bridge toward achieving sustainability goals when supported by favorable institutional, regulatory, and macroeconomic conditions. Moreover, the evidence confirms that the impact of entrepreneurship extends beyond economic metrics, influencing social and environmental sustainability dimensions. Therefore, based on robust multi-country studies, theoretical models, and policy-oriented frameworks, the following is the first hypothesis.\u003c/p\u003e \u003cp\u003eH1: Entrepreneurial activity positively contributes to economic sustainability.\u003c/p\u003e \u003c/div\u003e \u003cdiv id=\"Sec4\" class=\"Section2\"\u003e \u003ch2\u003e2.2. The role of entrepreneurial governance\u003c/h2\u003e \u003cp\u003eThe role of governance in shaping entrepreneurial ecosystems can be rigorously understood through the lens of the theory of the firm and institutional theory. The theory of the firm, particularly as conceptualized by Coase (\u003cspan citationid=\"CR14\" class=\"CitationRef\"\u003e1937\u003c/span\u003e) and later Williamson (\u003cspan citationid=\"CR45\" class=\"CitationRef\"\u003e1981\u003c/span\u003e), explains how firms emerge and organize transactions efficiently within or outside markets. In entrepreneurial contexts, this theory reveals how governance structures influence the allocation of decision-making authority, control over resources, and the distribution of risks and rewards\u0026mdash;all critical aspects of enabling innovative ventures. Simultaneously, institutional theory, as articulated by Scott (\u003cspan citationid=\"CR37\" class=\"CitationRef\"\u003e1995\u003c/span\u003e, \u003cspan citationid=\"CR38\" class=\"CitationRef\"\u003e2001\u003c/span\u003e), posits that the regulatory, normative, and cognitive pillars of society shape the behavior and legitimacy of organizations. When applied to entrepreneurship, this theory highlights how governance institutions provide the rules, norms, and shared beliefs that either facilitate or hinder entrepreneurial activity. As such, institutional theory underscores how external governance environments shape not only the feasibility of entrepreneurial activity but also its legitimacy and sustainability (North, \u003cspan citationid=\"CR28\" class=\"CitationRef\"\u003e1990\u003c/span\u003e; Scott, \u003cspan citationid=\"CR37\" class=\"CitationRef\"\u003e1995\u003c/span\u003e). Together, these theories offer a robust framework for understanding how governance\u0026mdash;both internal to firms and external at the institutional level\u0026mdash;shapes entrepreneurial ecosystems and enables entrepreneurship to contribute to long-term economic sustainability. As Grandori (\u003cspan citationid=\"CR19\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) argues, entrepreneurial governance is unique from capitalist or collective modes, characterized by hybrid ownership and adaptive organizational forms. These forms reconcile risk-taking with institutional accountability, thereby offering a conducive environment for entrepreneurship to flourish. Raimi and Haini (\u003cspan citationid=\"CR33\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) reinforce this view by demonstrating that in ECOWAS economies, normative governance elements\u0026mdash;especially government integrity and business freedom\u0026mdash;are significantly correlated with economic growth through entrepreneurship. This underscores that when governance aligns with entrepreneurial values such as innovation, transparency, and inclusivity, it fosters not only firm formation but also economic sustainability by encouraging responsible and scalable business activity.\u003c/p\u003e \u003cp\u003eEntrepreneurial governance functions as an institutional enabler that directly shapes the scope, scale, and sustainability of entrepreneurial initiatives. Governance mechanisms\u0026mdash;such as regulatory quality, rule of law, anti-corruption frameworks, and policy consistency\u0026mdash;reduce uncertainty and enhance trust, thereby lowering the cost and perceived risk of business entry. Empirical findings by Abegaz et al. (\u003cspan citationid=\"CR1\" class=\"CitationRef\"\u003e2023\u003c/span\u003e), based on data from 126 countries, confirm that governance indicators, such as government effectiveness and regulatory quality, have a strong and statistically significant influence on the number of formal business startups. This indicates that well-functioning governance systems do more than set the rules\u0026mdash;they actively inspire economic agency. M\u0026eacute;ndez-Picazo et al. (\u003cspan citationid=\"CR26\" class=\"CitationRef\"\u003e2012\u003c/span\u003e) further contextualize this by emphasizing that governance systems influence entrepreneurship by shaping macro-level institutional behavior and directly impacting economic outcomes. The result is a reinforcing feedback loop: better governance fosters more entrepreneurship, and vibrant entrepreneurial activity contributes to stronger economic structures. Xu et al. (\u003cspan citationid=\"CR48\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) extend this argument by introducing the role of digital governance in enabling entrepreneurship in less developed regions. Their study on Tibet demonstrates that digital governance infrastructures can significantly enhance entrepreneurial activity, particularly through improved access to information, streamlined administrative procedures, and expanded market opportunities. Thus, governance not only facilitates entrepreneurship through regulatory clarity but also enables it through technological and procedural innovations. In all these contexts, entrepreneurial governance is shown to be more than supportive\u0026mdash;it becomes a strategic driver that activates entrepreneurship as a force for sustainable economic transformation.\u003c/p\u003e \u003cp\u003eMoreover, entrepreneurial governance is normative in guiding entrepreneurship toward sustainable outcomes by embedding ethical decision-making, risk responsibility, and social inclusion into institutional practices. Carroll (\u003cspan citationid=\"CR12\" class=\"CitationRef\"\u003e2017\u003c/span\u003e) presents a comprehensive framework for entrepreneurial governance that integrates key entrepreneurial traits\u0026mdash;such as opportunity recognition, innovation, and implementation\u0026mdash;with public sector principles like accountability and risk mitigation. His framework responds to the critique that traditional governance structures are often risk-averse and ill-suited for supporting entrepreneurial dynamism. Instead, entrepreneurial governance encourages a shift in public policy from mere regulation to proactive support of innovation ecosystems. This perspective is echoed by Olsson et al. (\u003cspan citationid=\"CR29\" class=\"CitationRef\"\u003e2020\u003c/span\u003e), who provide evidence from Swedish municipalities showing that entrepreneurial governance at the local level, particularly in urban areas, is positively associated with employment growth. Their findings demonstrate that entrepreneurial governance facilitates not only business creation but also regional economic resilience. Additionally, the presence of sub-components, such as opportunity discovery and resource mobilization, was positively correlated with economic outcomes, even in rural contexts, demonstrating the adaptability of entrepreneurial governance across different development levels. These results confirm that entrepreneurial governance can promote inclusive and equitable growth by integrating localized strategies, fostering public-private collaboration, and promoting the creation of shared value. In effect, governance structures become agents of sustainability, channeling entrepreneurial energy into ventures that are resilient, socially beneficial, and aligned with long-term developmental goals.\u003c/p\u003e \u003cp\u003eDrawing from the breadth of theoretical frameworks and empirical evidence discussed, it becomes evident that entrepreneurial governance is not only a catalyst but also a directional force that channels entrepreneurial activity toward sustainable economic outcomes. Governance structures that emphasize institutional quality, transparency, innovation support, and responsible risk-taking create fertile ground for entrepreneurship to emerge, scale, and align with long-term developmental goals. Whether through digital governance in underdeveloped regions, municipal-level policies in urban economies, or national strategies across developing and developed countries, the enabling power of entrepreneurial governance is repeatedly affirmed. By shaping the regulatory, normative, and cognitive environments in which entrepreneurship takes place, governance directly influences both the quantity and quality of entrepreneurial ventures. These ventures, in turn, contribute to inclusive growth, job creation, and resilience against economic shocks\u0026mdash;core tenets of economic sustainability. The impact of entrepreneurial governance is both theoretically grounded and empirically validated. Entrepreneurial governance is not just supportive of entrepreneurship; it is instrumental in ensuring that entrepreneurial initiatives yield enduring, sustainable economic impacts. Therefore, the second hypothesis is as follows.\u003c/p\u003e \u003cp\u003eH2: Entrepreneurial governance drives entrepreneurial activity to achieve economic sustainability.\u003c/p\u003e \u003c/div\u003e \u003cdiv id=\"Sec5\" class=\"Section2\"\u003e \u003ch2\u003e2.3. The role of digital infrastructure\u003c/h2\u003e \u003cp\u003eThe Resource-Based Theory (RBT) offers a foundational lens through which to understand the strategic role of digital infrastructure in promoting entrepreneurial activity and achieving economic sustainability. According to RBT, firms gain and sustain a competitive advantage by acquiring and effectively deploying valuable, rare, inimitable, and non-substitutable (VRIN) resources (Barney, \u003cspan citationid=\"CR8\" class=\"CitationRef\"\u003e1991\u003c/span\u003e). In the context of entrepreneurship, digital infrastructure\u0026mdash;encompassing broadband access, mobile technologies, digital platforms, and ICT systems\u0026mdash;qualifies as such a resource, as it is increasingly essential yet unevenly distributed, thus offering a basis for competitive differentiation (Wernerfelt, \u003cspan citationid=\"CR44\" class=\"CitationRef\"\u003e1984\u003c/span\u003e; Bharadwaj, \u003cspan citationid=\"CR10\" class=\"CitationRef\"\u003e2000\u003c/span\u003e). It enhances firms\u0026rsquo; and individuals\u0026rsquo; ability to access markets, process information, and innovate efficiently. The theory posits that when digital capabilities are embedded within entrepreneurial ecosystems, they serve as strategic assets that drive the creation of new ventures, scalability, and long-term performance. Empirical studies confirm this theoretical insight. For instance, Li et al. (\u003cspan citationid=\"CR24\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) demonstrate that digital infrastructure significantly enhances individual entrepreneurship in China by creating enabling conditions, such as flexible work environments and improved access to information related to opportunities. Digitalization reduces transaction costs and uncertainty, especially for disadvantaged groups, thus broadening the entrepreneurial base. Schade and Schuhmacher (\u003cspan citationid=\"CR35\" class=\"CitationRef\"\u003e2022\u003c/span\u003e) further reinforce this by showing that digital infrastructure moderates the relationship between individual cognitive traits and entrepreneurial action formation, thus functioning as an external enabler. This means that a robust digital environment enhances self-efficacy and opportunity recognition, leading to more frequent and confident entrepreneurial behaviors. Moreover, rural entrepreneurship studies, such as those by Bowen and Morris (\u003cspan citationid=\"CR11\" class=\"CitationRef\"\u003e2019\u003c/span\u003e), reveal that inadequate digital infrastructure hinders entrepreneurial potential, innovation, and economic diversification in rural areas. In contrast, digitally equipped regions show higher startup rates, innovation levels, and resilience\u0026mdash;core dimensions of sustainable economic ecosystems.\u003c/p\u003e \u003cp\u003eBeyond enabling access, digital infrastructure serves as a mechanism for entrepreneurs to overcome traditional barriers related to capital, information, and social connectivity\u0026mdash;factors emphasized by Resource-Based Theory (RBT) and Resource Dependence Theory. Wei et al. (\u003cspan citationid=\"CR43\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) show that digital infrastructure enhances household entrepreneurship by mitigating financial constraints, expanding social networks, and fostering information advantages. These mechanisms, facilitated by widespread broadband adoption and mobile technologies, improve not only the frequency of entrepreneurial activity but also its quality and sustainability. Wu et al. (\u003cspan citationid=\"CR46\" class=\"CitationRef\"\u003e2023\u003c/span\u003e) corroborate these findings by demonstrating that regional digital infrastructure has a significant impact on enterprise-level digital transformation, which in turn promotes entrepreneurial orientation (EO). Here, EO is strengthened through improved knowledge flows, inter-organizational collaboration, and agile decision-making\u0026mdash;an entrepreneurial mindset critical to sustaining innovation. In urban settings, Xiong et al. (\u003cspan citationid=\"CR47\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) find that cities with stronger digital infrastructure benefit from increased entrepreneurial activity, particularly in sectors that leverage digital financial inclusion and expand consumer networks. These outcomes are not accidental but rather the product of systemic enablers grounded in infrastructure. From this perspective, digital infrastructure serves as a bridge, connecting entrepreneurial intention with execution by equipping potential entrepreneurs with the necessary tools and resources to succeed. Yin et al. (\u003cspan citationid=\"CR49\" class=\"CitationRef\"\u003e2019\u003c/span\u003e) and Gomes and Lopes (\u003cspan citationid=\"CR18\" class=\"CitationRef\"\u003e2022\u003c/span\u003e) extend this understanding by emphasizing how mobile payments, broadband, and internet access enhance risk tolerance, social capital, and innovative capacity. These digitally-enabled traits are not merely facilitators of business formation\u0026mdash;they are foundational to the emergence of resilient, scalable, and economically sustainable ventures. These findings collectively validate RBT\u0026rsquo;s assertion that when strategically embedded and leveraged, infrastructure becomes a core organizational and societal resource.\u003c/p\u003e \u003cp\u003eCrucially, digital infrastructure does not merely facilitate entrepreneurship\u0026mdash;it aligns entrepreneurial activity with the goals of economic sustainability by fostering innovation, inclusivity, and environmental awareness. Hussain et al. (\u003cspan citationid=\"CR21\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) find that digital infrastructure has a direct and significant effect on innovation performance within SMEs, particularly when combined with e-knowledge and digital innovation. This interplay ensures that entrepreneurial activity is not just economically productive but also ecologically and socially aligned with long-term sustainability objectives. Wang et al. (\u003cspan citationid=\"CR42\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) note that the digital economy, driven by infrastructure, enhances the quality of human capital and promotes entrepreneurial dynamism, particularly in urban areas. This synergy yields shared prosperity, equitable growth, and reduced inequality, all of which are key pillars of sustainable development. In Saudi Arabia, studies by Altwaijri et al. (\u003cspan citationid=\"CR5\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) and Alfehaid et al. (\u003cspan citationid=\"CR4\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) confirm that ICT diffusion, especially when coupled with opportunity-driven entrepreneurship, contributes significantly to environmental and economic sustainability. These interactions show how digital infrastructure not only supports business creation but also shapes its direction toward sustainable goals. Moreover, the Global Index of Digital Entrepreneurship Systems (GIDES), developed by Autio et al. (\u003cspan citationid=\"CR7\" class=\"CitationRef\"\u003e2024\u003c/span\u003e), demonstrates that national-level digital conditions\u0026mdash;including infrastructure, culture, and institutional support\u0026mdash;are crucial in fostering high-quality, systemically impactful entrepreneurship. Digitalization thus serves a dual role: as a catalyst for entrepreneurial activity and as a framework condition ensuring that this activity aligns with long-term sustainability objectives. Through integrating digital tools, platforms, and systems, entrepreneurs can optimize resource use, innovate responsibly, and contribute to more inclusive economic systems\u0026mdash;essential outcomes for resilient societies in the digital age.\u003c/p\u003e \u003cp\u003eBased on the accumulated theoretical insights and empirical evidence, it is reasonable to deduce that digitalization, underpinned by robust digital infrastructure, drives entrepreneurial activity in ways that meaningfully contribute to economic sustainability. Rooted in resource-based theory, digital infrastructure emerges as a strategic resource that enhances the capabilities of individuals and organizations to identify, exploit, and sustain opportunities. It lowers barriers to entry, facilitates innovation, and enables inclusive participation in economic systems. Moreover, it ensures that entrepreneurial ventures are not only viable but also aligned with the broader goals of sustainability\u0026mdash;be they environmental, economic, or social. Whether through improved financial access, expanded market reach, enhanced innovation capacity, or reduced environmental footprint, the influence of digital infrastructure is both profound and far-reaching. Digital infrastructure should not be viewed merely as a technological tool but as a strategic and transformative enabler of sustainable entrepreneurship in the 21st century. Therefore, the third hypothesis is as follows:\u003c/p\u003e \u003cp\u003eH3: Digitalization drives entrepreneurial activity to achieve economic sustainability.\u003c/p\u003e \u003cp\u003eAs illustrated in Fig.\u0026nbsp;\u003cspan refid=\"Fig1\" class=\"InternalRef\"\u003e1\u003c/span\u003e, entrepreneurial governance and digital infrastructure are essential pillars of economic sustainability. While governance ensures that entrepreneurial activities are effectively guided, regulated, and aligned with long-term development goals, digital infrastructure provides the technological backbone that enables innovation, efficiency, and scalability of entrepreneurial ventures. Together, they form a complementary and dynamic system that facilitates the transition toward a more inclusive, resilient, and sustainable economic future.\u003c/p\u003e \u003cp\u003e \u003c/p\u003e \u003c/div\u003e"},{"header":"3. Data and Methodology","content":"\u003cdiv id=\"Sec7\" class=\"Section2\"\u003e \u003ch2\u003e3.1. Data\u003c/h2\u003e \u003cp\u003eThis study draws on an unbalanced panel dataset covering 16 emerging economies from 2004 to 2021, selected based on data availability from the Global Entrepreneurship Monitor (GEM), World Development Indicators (WDI), Heritage Foundation (HF), and United Nations databases (Table\u0026nbsp;\u003cspan refid=\"Tab1\" class=\"InternalRef\"\u003e1\u003c/span\u003e) The focus on emerging economies is intentional, given their structural vulnerabilities and opportunities for leveraging entrepreneurship as a tool for economic transformation. These countries\u0026mdash;Argentina, Brazil, China, Colombia, Egypt, India, Indonesia, Iran, Malaysia, Mexico, Peru, the Philippines, Romania, South Africa, Thailand, and Turkey\u0026mdash;represent dynamic settings where entrepreneurial governance and digital infrastructure can significantly affect sustainability outcomes.\u003c/p\u003e \u003cp\u003eThe key variables selected to illustrate how the different types of entrepreneurship influence economic sustainability include:\u003c/p\u003e \u003cdiv id=\"Sec8\" class=\"Section3\"\u003e \u003ch2\u003e3.1.1. Dependent variable\u003c/h2\u003e \u003cp\u003eThe dependent variable in this study is economic sustainability, measured using a composite index constructed by the authors through Principal Component Analysis (PCA). As shown in Table\u0026nbsp;\u003cspan refid=\"Tab2\" class=\"InternalRef\"\u003e2\u003c/span\u003e, this index captures the structural soundness and long-term viability of economic systems by integrating five key indicators aligned with Sustainable Development Goals (SDGs) 7 (Affordable and Clean Energy), 8 (Decent Work and Economic Growth), 9 (Industry, Innovation and Infrastructure), 11 (Sustainable Cities and Communities), and 12 (Responsible Consumption and Production). All indicators were standardized using the Min-Max Normalization technique to harmonize units and ensure that higher values reflect stronger sustainability performance. Missing values were addressed using mean imputation, following the recommendations of Kondyli (2010) to maintain data consistency while preserving as much information as possible.\u003c/p\u003e \u003cp\u003eTo construct the composite Economic Sustainability Index (ESI), PCA was applied to the standardized indicators to extract the principal components explaining the majority of the variance across countries and time. The adequacy of the data for PCA was assessed through the Kaiser-Meyer-Olkin (KMO) test and Bartlett\u0026rsquo;s Test of Sphericity. Components with eigenvalues greater than one were retained, and the final index was computed as a weighted average of these components using their eigenvalues as weights. This approach aligns with the methodology proposed by Costanza et al. (2016), ensuring the index is statistically robust and conceptually grounded. The resulting ESI ranges from 0 to 1, with higher values indicating stronger economic sustainability, and is used as the main dependent variable in the empirical models to evaluate the impact of entrepreneurship, governance, and digital infrastructure in emerging economies.\u003c/p\u003e \u003cp\u003eThe general form of a principal component (PC) can be expressed mathematically as:\u003cdiv id=\"Equ1\" class=\"Equation\"\u003e\u003cdiv format=\"TEX\" class=\"mathdisplay\" id=\"FileID_Equ1\" name=\"EquationSource\"\u003e\n$$\\:{b}_{1}^{p}{X}_{1}^{p}+\\dots\\:+{b}_{n}^{p}{X}_{n}^{p}$$\u003c/div\u003e\u003cdiv class=\"EquationNumber\"\u003e1\u003c/div\u003e\u003c/div\u003e\u003c/p\u003e \u003cp\u003eWhere PC\u003csup\u003ep\u003c/sup\u003e is the score of the principal component p, b\u003csup\u003ep\u003c/sup\u003e\u003csub\u003en\u003c/sub\u003e ​ represents the weight (or loading) assigned to the n\u003csup\u003eth\u003c/sup\u003e standardized variable of the p\u003csup\u003eth\u003c/sup\u003e component, and X\u003csup\u003ep\u003c/sup\u003e\u003csub\u003en\u003c/sub\u003e is the standardized value of the n\u003csup\u003eth\u003c/sup\u003e variable for unit p.\u003c/p\u003e \u003cp\u003eAs reported in Table\u0026nbsp;\u003cspan refid=\"Tab3\" class=\"InternalRef\"\u003e3\u003c/span\u003e, the ESI is constructed using two principal components (eco1 and eco2) extracted from the PCA. These two components together account for 85.14% of the total variance, with eco1 explaining 52.84% and eco2 contributing an additional 32.30%. This high cumulative variance indicates that the selected components capture the dominant underlying structure of the economic sustainability construct. The three remaining components (eco3 to eco5) were excluded due to their marginal explanatory power, as they accounted for only 14.86% of the variance.\u003c/p\u003e \u003cp\u003eThe final index is derived using a weighted aggregation approach based on the eigenvalues of the retained components. Following Bregar et al. (2008), the aggregated index is formulated as:\u003cdiv id=\"Equ2\" class=\"Equation\"\u003e\u003cdiv format=\"TEX\" class=\"mathdisplay\" id=\"FileID_Equ2\" name=\"EquationSource\"\u003e\n$$\\:{ESI}_{p}=\\frac{{\\sum\\:}_{i=1}^{m}{F}_{Pi}*{\\lambda\\:}_{i}}{{\\sum\\:}_{i=1}^{m}{\\lambda\\:}_{i}}$$\u003c/div\u003e\u003cdiv class=\"EquationNumber\"\u003e2\u003c/div\u003e\u003c/div\u003e\u003c/p\u003e \u003cp\u003eWhere \u003cem\u003eESIp\u003c/em\u003e​ is the Economic Sustainability Index for country p, eco1p and eco2p are the scores of the first and second principal components, respectively, and λ1and λ2 are their corresponding eigenvalues used as weights. The application of this formula ensures that components with greater explanatory power contribute proportionally more to the final index. The KMO measure of 0.657 and the highly significant Bartlett\u0026rsquo;s Test of Sphericity (p\u0026thinsp;\u0026lt;\u0026thinsp;0.01) confirm the adequacy of the data for PCA and the existence of meaningful correlations among the variables. Overall, the constructed ESI serves as a reliable and statistically grounded composite indicator for evaluating economic sustainability in emerging economies across the study period.\u003c/p\u003e \u003cp\u003e \u003cdiv class=\"gridtable\"\u003e\u003ctable float=\"Yes\" id=\"Tab1\" border=\"1\"\u003e \u003ccaption language=\"En\"\u003e \u003cdiv class=\"CaptionNumber\"\u003eTable 1\u003c/div\u003e \u003cdiv class=\"CaptionContent\"\u003e \u003cp\u003eMeasures, sources, and expected signs of the variables.\u003c/p\u003e \u003c/div\u003e \u003c/caption\u003e \u003ccolgroup cols=\"8\"\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c1\" colnum=\"1\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c2\" colnum=\"2\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c3\" colnum=\"3\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c4\" colnum=\"4\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c5\" colnum=\"5\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c6\" colnum=\"6\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c7\" colnum=\"7\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c8\" colnum=\"8\"\u003e\u003c/div\u003e \u003cthead\u003e \u003ctr\u003e \u003cth align=\"left\" colspan=\"2\" nameend=\"c2\" namest=\"c1\"\u003e \u003cp\u003eVariable\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c3\"\u003e \u003cp\u003eMeasurement\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c4\"\u003e \u003cp\u003eSource\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c5\"\u003e \u003cp\u003eMean\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c6\"\u003e \u003cp\u003eSD\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c7\"\u003e \u003cp\u003eMin.\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c8\"\u003e \u003cp\u003eMax.\u003c/p\u003e \u003c/th\u003e \u003c/tr\u003e \u003c/thead\u003e \u003ctbody\u003e \u003ctr\u003e \u003ctd align=\"left\" colspan=\"5\" nameend=\"c5\" namest=\"c1\"\u003e \u003cp\u003e\u003cem\u003eDependent variable\u003c/em\u003e\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c8\"\u003e\u0026nbsp;\u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colspan=\"2\" nameend=\"c2\" namest=\"c1\"\u003e \u003cp\u003eEconomic sustainability\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eEconomic sustainability index\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003eAuthors\u0026rsquo; calculation\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.396\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.202\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e \u003cp\u003e0\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c8\"\u003e \u003cp\u003e1\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colspan=\"5\" nameend=\"c5\" namest=\"c1\"\u003e \u003cp\u003e\u003cem\u003eIndependent variables\u003c/em\u003e\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c8\"\u003e\u0026nbsp;\u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colspan=\"2\" nameend=\"c2\" namest=\"c1\"\u003e \u003cp\u003eOpportunity entrepreneurship\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eThe percentage of individuals aged 18 to 64 who start a new business to seize a promising market opportunity, driven by innovation, profit potential, or personal ambition rather than necessity.\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003eGEM\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e49.469\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e16.580\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e \u003cp\u003e5.590\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c8\"\u003e \u003cp\u003e97.989\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colspan=\"2\" nameend=\"c2\" namest=\"c1\"\u003e \u003cp\u003eNecessity entrepreneurship\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eThe percentage of individuals aged 18 to 64 who start a new business due to a lack of better employment options, often driven by economic need rather than the pursuit of opportunity.\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003eGEM\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e34.399\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e22.491\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e \u003cp\u003e2.020\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c8\"\u003e \u003cp\u003e85\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colspan=\"2\" nameend=\"c2\" namest=\"c1\"\u003e \u003cp\u003eTotal Early-stage Entrepreneurial Activity (TEA)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eThe percentage of the adult population (aged 18 to 64) who are actively engaged in starting a new business (nascent entrepreneurs) or managing a business less than 42 months old.\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003eGEM\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e15.825\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e10.365\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e \u003cp\u003e4.021\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c8\"\u003e \u003cp\u003e51.309\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colspan=\"5\" nameend=\"c5\" namest=\"c1\"\u003e \u003cp\u003e\u003cem\u003eModerator variables\u003c/em\u003e\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c8\"\u003e\u0026nbsp;\u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\" morerows=\"1\" rowspan=\"2\"\u003e \u003cp\u003eDigital infrastructure\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003eE-governance\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eElectronic Government Development Index (EGDI)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003eUnited Nations\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.562\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.120\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e \u003cp\u003e0.265\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c8\"\u003e \u003cp\u003e0.891\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003eICT use\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eIndividuals using the Internet (% of population)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003eWDI\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e40.034\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e23.321\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e \u003cp\u003e1.976\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c8\"\u003e \u003cp\u003e96.8\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\" morerows=\"2\" rowspan=\"3\"\u003e \u003cp\u003eEntrepreneurial governance\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003eGovernment integrity\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eGovernment integrity index (0\u0026ndash;100)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003eHF\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e35.308\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e7.475\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e \u003cp\u003e10\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c8\"\u003e \u003cp\u003e55.4\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003eBusiness Freedom\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eBusiness freedom index (0\u0026ndash;100)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003eHF\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e63.8199\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e11.340\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e \u003cp\u003e35.5\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c8\"\u003e \u003cp\u003e93.5\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003eInvestment freedom\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eInvestment freedom index (0\u0026ndash;100)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003eHF\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e47.676\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e18.262\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e \u003cp\u003e0\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c8\"\u003e \u003cp\u003e80\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colspan=\"5\" nameend=\"c5\" namest=\"c1\"\u003e \u003cp\u003e\u003cem\u003eControl variables\u003c/em\u003e\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c8\"\u003e\u0026nbsp;\u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colspan=\"2\" nameend=\"c2\" namest=\"c1\"\u003e \u003cp\u003eTrade\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eThe sum of exports and imports of goods and services as a percentage of Gross Domestic Product (GDP).\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003eWDI\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e61.067\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e34.345\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e \u003cp\u003e22.106\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c8\"\u003e \u003cp\u003e210.374\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colspan=\"2\" nameend=\"c2\" namest=\"c1\"\u003e \u003cp\u003eFinancial development\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eDomestic credit to the private sector by banks (% of GDP)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003eWDI\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e53.489\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e36.038\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e \u003cp\u003e9.501\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c8\"\u003e \u003cp\u003e179.1\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colspan=\"2\" nameend=\"c2\" namest=\"c1\"\u003e \u003cp\u003eRule of law\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eThe Rule of Law score ranges from approximately \u0026minus;\u0026thinsp;2.5 to 2.5, indicating a country's relative standing compared to the Rule of Law index average.\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003eWDI\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e-0.289\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.385\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e \u003cp\u003e-1.054\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c8\"\u003e \u003cp\u003e0.6\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003c/tbody\u003e \u003c/colgroup\u003e \u003ctfoot\u003e \u003ctr\u003e\u003ctd colspan=\"8\"\u003eNote: N\u0026thinsp;=\u0026thinsp;288 observations from an unbalanced panel dataset from 16 emerging countries from 2004 to 2021. Countries include Argentina, Brazil, China, Colombia, Egypt, India, Indonesia, Iran, Malaysia, Mexico, Peru, the Philippines, Romania, South Africa, Thailand, and Turkey. GEM is the Global Entrepreneurship Monitor, WDI is the World Development Indicators, and HF is the Heritage Foundation.\u003c/td\u003e\u003c/tr\u003e \u003c/tfoot\u003e \u003c/table\u003e\u003c/div\u003e \u003c/p\u003e \u003cp\u003e \u003cdiv class=\"gridtable\"\u003e\u003ctable float=\"Yes\" id=\"Tab2\" border=\"1\"\u003e \u003ccaption language=\"En\"\u003e \u003cdiv class=\"CaptionNumber\"\u003eTable 2\u003c/div\u003e \u003cdiv class=\"CaptionContent\"\u003e \u003cp\u003eMeasure and source of the SDGs\u0026rsquo; indicators.\u003c/p\u003e \u003c/div\u003e \u003c/caption\u003e \u003ccolgroup cols=\"4\"\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c1\" colnum=\"1\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c2\" colnum=\"2\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c3\" colnum=\"3\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c4\" colnum=\"4\"\u003e\u003c/div\u003e \u003cthead\u003e \u003ctr\u003e \u003cth align=\"left\" colname=\"c1\"\u003e\u0026nbsp;\u003c/th\u003e \u003cth align=\"left\" colname=\"c2\"\u003e \u003cp\u003eGoal\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c3\"\u003e \u003cp\u003eIndicators\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c4\"\u003e \u003cp\u003eSources\u003c/p\u003e \u003c/th\u003e \u003c/tr\u003e \u003c/thead\u003e \u003ctbody\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\" morerows=\"4\" rowspan=\"5\"\u003e \u003cp\u003eEconomic Sustainability\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e7\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eAccess to clean fuels and technologies for cooking (% of the population)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\" morerows=\"4\" rowspan=\"5\"\u003e \u003cp\u003eWDI\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e8\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eAnnual GDP per Capita Growth (%)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e9\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eManufacturing value added (% of GDP)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e11\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eUrban population (% of total population)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e12\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eAdjusted Net Savings (excluding damage from particulate emissions) (% of GNI)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003c/tbody\u003e \u003c/colgroup\u003e \u003c/table\u003e\u003c/div\u003e \u003c/p\u003e \u003cp\u003e \u003cdiv class=\"gridtable\"\u003e\u003ctable float=\"Yes\" id=\"Tab3\" border=\"1\"\u003e \u003ccaption language=\"En\"\u003e \u003cdiv class=\"CaptionNumber\"\u003eTable 3\u003c/div\u003e \u003cdiv class=\"CaptionContent\"\u003e \u003cp\u003ePCA results of the SDI.\u003c/p\u003e \u003c/div\u003e \u003c/caption\u003e \u003ccolgroup cols=\"4\"\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c1\" colnum=\"1\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c2\" colnum=\"2\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c3\" colnum=\"3\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c4\" colnum=\"4\"\u003e\u003c/div\u003e \u003cthead\u003e \u003ctr\u003e \u003cth align=\"left\" colname=\"c1\"\u003e \u003cp\u003eComponent\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c2\"\u003e \u003cp\u003eEigenvalue\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c3\"\u003e \u003cp\u003eProportion explained (%)\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c4\"\u003e \u003cp\u003eCumulative (%)\u003c/p\u003e \u003c/th\u003e \u003c/tr\u003e \u003c/thead\u003e \u003ctbody\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eEco1\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e2.642\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e52.84\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e52.84\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eEco2\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e1.615\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e32.30\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e85.14\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eEco3\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.431\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e8.62\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e93.76\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eEco4\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.212\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e4.24\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e98\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eEco5\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.100\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e2.00\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e100.00\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eKMO\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colspan=\"3\" nameend=\"c4\" namest=\"c2\"\u003e \u003cp\u003e0.657\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eBartlett Test (p-value)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colspan=\"3\" nameend=\"c4\" namest=\"c2\"\u003e \u003cp\u003e0.000\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003c/tbody\u003e \u003c/colgroup\u003e \u003c/table\u003e\u003c/div\u003e \u003c/p\u003e \u003c/div\u003e \u003cdiv id=\"Sec9\" class=\"Section3\"\u003e \u003ch2\u003e3.1.2. Independent variables\u003c/h2\u003e \u003cp\u003eThis study includes three distinct measures of entrepreneurial activity as independent variables, drawn from the Global Entrepreneurship Monitor (GEM): Total Early-stage Entrepreneurial Activity (TEA), opportunity-driven entrepreneurship, and necessity-driven entrepreneurship. TEA represents the percentage of the adult population (aged 18\u0026ndash;64) who are actively engaged in either starting a new business (nascent entrepreneurs) or managing a business that is less than 42 months old. It provides a broad measure of entrepreneurial dynamism within a country, capturing both necessity- and opportunity-motivated business creation. Opportunity-driven entrepreneurship refers to individuals who launch a business to pursue a promising market opportunity, motivated by innovation, financial potential, or personal ambition rather than a lack of alternatives. This form of entrepreneurship is widely associated with higher productivity, innovation spillovers, and more sustainable economic outcomes (Acs et al., \u003cspan citationid=\"CR2\" class=\"CitationRef\"\u003e2008\u003c/span\u003e; Audretsch \u0026amp; Keilbach, \u003cspan citationid=\"CR6\" class=\"CitationRef\"\u003e2004\u003c/span\u003e; Dean \u0026amp; McMullen, \u003cspan citationid=\"CR15\" class=\"CitationRef\"\u003e2007\u003c/span\u003e). In contrast, necessity-driven entrepreneurship reflects individuals who start a business due to the absence of better employment options, often under constrained economic circumstances. While such activity may provide subsistence-level income and reduce unemployment in the short term, it tends to have lower growth potential and limited long-term impact on economic sustainability (Reynolds et al., \u003cspan citationid=\"CR34\" class=\"CitationRef\"\u003e2005\u003c/span\u003e; Poschke, \u003cspan citationid=\"CR31\" class=\"CitationRef\"\u003e2013\u003c/span\u003e).\u003c/p\u003e \u003cp\u003eBy distinguishing among these entrepreneurial forms, the analysis captures important heterogeneity in how entrepreneurship influences economic sustainability. Prior research suggests that opportunity-driven and TEA entrepreneurship are more likely to foster structural transformation, innovation, and formal sector employment, whereas necessity-driven ventures may remain informal, vulnerable, and less productive (van Stel et al., \u003cspan citationid=\"CR41\" class=\"CitationRef\"\u003e2005\u003c/span\u003e; Belz \u0026amp; Binder, \u003cspan citationid=\"CR9\" class=\"CitationRef\"\u003e2017\u003c/span\u003e). Including these differentiated indicators allows the study to examine both the quality and quantity of entrepreneurial activity and their respective contributions to economic sustainability in emerging markets. All three measures are sourced from the GEM database and are reported as percentages of the working-age population.\u003c/p\u003e \u003c/div\u003e \u003cdiv id=\"Sec10\" class=\"Section3\"\u003e \u003ch2\u003e3.1.3. Moderator variables\u003c/h2\u003e \u003cp\u003eThe two moderating variables included in this study are Digital Infrastructure (DI) and Entrepreneurial Governance (EG). Digital Infrastructure reflects a country\u0026rsquo;s technological readiness and the digital environment that supports entrepreneurial activities, innovation diffusion, and business scalability. It is measured using two core indicators: the Electronic Government Development Index (EGDI) and the percentage of individuals using the Internet. EGDI assesses how effectively a government utilizes digital tools to deliver public services, promote transparency, and facilitate business interactions with public institutions, thereby enhancing administrative efficiency (United Nations, \u003cspan citationid=\"CR40\" class=\"CitationRef\"\u003e2020\u003c/span\u003e). The share of individuals using the Internet captures the extent of digital penetration and accessibility within the economy, indicating the level of integration of digital technologies into business practices and daily life. A stronger digital infrastructure is expected to enhance the connection between entrepreneurship and economic sustainability by promoting innovation, facilitating market access, and improving operational efficiency. Entrepreneurial Governance (EG), the second moderating variable, captures the quality of the institutional and regulatory environment that shapes entrepreneurial behavior and business viability. It is assessed through three key dimensions from the Heritage Foundation Index: government integrity, business freedom, and investment freedom. Government integrity reflects the degree of transparency, control of corruption, and ethical standards in public institutions, which can reduce transaction costs and promote trust-based entrepreneurial ecosystems. Business freedom measures the burden of regulation on starting and operating businesses, with higher values indicating fewer bureaucratic obstacles and greater market flexibility. Investment freedom assesses the extent to which capital can flow freely in and out of an economy without restrictions, which is essential for entrepreneurship to thrive in capital-intensive sectors. Collectively, these components provide a nuanced understanding of how institutional quality and policy frameworks influence the relationship between entrepreneurship and sustainability.\u003c/p\u003e \u003c/div\u003e \u003cdiv id=\"Sec11\" class=\"Section3\"\u003e \u003ch2\u003e3.1.4. Control Variables\u003c/h2\u003e \u003cp\u003eConsistent with the sustainability literature, this study incorporates several control variables that are likely to influence economic sustainability: trade openness, financial development, and the rule of law. Trade openness, measured by the sum of exports and imports as a percentage of GDP, is expected to support economic sustainability by facilitating technology transfer, expanding market access, and encouraging specialization based on comparative advantage. Greater integration into global markets can enhance productivity and competitiveness, thereby contributing to more resilient economic structures. Financial development, measured by domestic credit to the private sector as a percentage of GDP, is expected to positively impact economic sustainability, as well-functioning financial systems mobilize capital, allocate resources efficiently, and support long-term investments in innovation and infrastructure (Ben Youssef et al., 2020; Slimani et al., 2024). The rule of law is also included as a key institutional control variable, reflecting the quality of governance, legal enforcement, and regulatory frameworks. A stronger rule of law enhances investor confidence, protects property rights, and ensures policy stability\u0026mdash;factors that are fundamental to economic resilience and sustainable growth. Prior studies have shown that countries with higher rule-of-law scores tend to experience greater institutional effectiveness and long-term economic performance (Ben Youssef et al., 2020; Altwaijri et al., \u003cspan citationid=\"CR5\" class=\"CitationRef\"\u003e2024\u003c/span\u003e). Together, these control variables help account for the broader macroeconomic and institutional context that may shape the relationship between entrepreneurship and economic sustainability.\u003c/p\u003e \u003cp\u003eTable\u0026nbsp;\u003cspan refid=\"Tab1\" class=\"InternalRef\"\u003e1\u003c/span\u003e presents the descriptive statistics for the variables used in this study. The ESI, the key dependent variable measuring the economic dimension of sustainable development, has an average value of 0.396, with observed values ranging from 0.000 to 1.000 across countries and years. Regarding entrepreneurial activity, opportunity-driven entrepreneurship\u0026mdash;defined as the proportion of individuals aged 18 to 64 who initiate a business in response to market opportunities\u0026mdash;has a mean of 49.33%, with values ranging from 5.59% to 97.98%. In contrast, necessity-driven entrepreneurship, which reflects business creation due to a lack of better options, shows a lower average of 31.25%, ranging from 2.02% to 85%. The overall TEA has a mean of 17.16% (not shown in this paragraph, but available), capturing both opportunity- and necessity-based ventures. Turning to the moderator variables, government integrity, which reflects perceptions of public sector transparency and corruption, averages 35.18 (out of 100), ranging from 7.48 to 55.40. Business freedom and investment freedom, proxies for the entrepreneurial governance environment, show mean values of 63.56 and 47.39, respectively. On the digital infrastructure side, the EGDI averages 0.556, spanning from 0.000 to 0.891. Access to digital services is also reflected in ICT indicators: ICT access, measured by mobile cellular subscriptions per 100 people, averages 92.05, with values ranging from 4.60 to 181.77, while ICT use, proxied by the percentage of individuals using the internet, records a mean of 40.04%, with a minimum of 1.98% and a maximum of 96.80%.\u003c/p\u003e \u003c/div\u003e \u003c/div\u003e \u003cdiv id=\"Sec12\" class=\"Section2\"\u003e \u003ch2\u003e3.2. Methodology\u003c/h2\u003e \u003cp\u003eIn line with the 2030 Agenda for Sustainable Development, entrepreneurship has emerged as a crucial driver of long-term economic resilience, particularly in emerging economies. Among its forms, opportunity-driven entrepreneurship is recognized for its role in fostering innovation, productivity, and sustainable job creation, unlike necessity-driven entrepreneurship, which typically arises from a lack of alternatives and tends to generate limited long-term economic value (Acs et al., 2018; Autio et al., 2014; Dhahri \u0026amp; Omri, 2018). Given these differences, disaggregating entrepreneurial types is essential to understanding their distinct contributions to economic sustainability. Moreover, the impact of entrepreneurship is shaped by entrepreneurial governance\u0026mdash;including regulatory quality and investment freedom\u0026mdash;and digital infrastructure, such as e-government readiness and ICT access. These structural enablers facilitate business activity, enhance resource efficiency, and support innovation-led growth (Djankov et al., 2002; World Bank, 2021; Katz \u0026amp; Callorda, 2018). Based on these insights, the proposed framework links TEA, opportunity- and necessity-driven entrepreneurship to economic sustainability, moderated by governance and digital infrastructure, as specified in Eq.\u0026nbsp;(\u003cspan refid=\"Equ3\" class=\"InternalRef\"\u003e3\u003c/span\u003e):\u003cdiv id=\"Equ3\" class=\"Equation\"\u003e\u003cdiv format=\"TEX\" class=\"mathdisplay\" id=\"FileID_Equ3\" name=\"EquationSource\"\u003e\n$$\\:{ESI}_{it}=\\:{{\\beta\\:}_{0}+{\\beta\\:}_{1}E}_{it}+{{\\beta\\:}_{2}DI}_{it}+{{\\beta\\:}_{3}EG}_{it}+{{\\beta\\:}_{4}Z}_{it}+{\\epsilon\\:}_{it}$$\u003c/div\u003e\u003cdiv class=\"EquationNumber\"\u003e3\u003c/div\u003e\u003c/div\u003e\u003c/p\u003e \u003cp\u003eWhere ESI denotes the Economic Sustainability Index, the dependent variable of interest. E represents the vector of entrepreneurship indicators, including TEA, opportunity-driven entrepreneurship (OPE), and necessity-driven entrepreneurship (NCE). DI captures digital infrastructure, measured through e-government development and ICT use, while EG refers to entrepreneurial governance, proxied by government integrity, business freedom, and investment freedom. Z denotes a vector of control variables. The subscript \u003cem\u003ei\u003c/em\u003e indicates the country (cross-sectional unit), and \u003cem\u003et\u003c/em\u003e denotes the time period. β represents the vector of estimated coefficients, and ε is the stochastic error term.\u003c/p\u003e \u003cp\u003eIncorporating the transmission mechanisms of DI and EG, Eq.\u0026nbsp;(\u003cspan refid=\"Equ3\" class=\"InternalRef\"\u003e3\u003c/span\u003e) is reformulated to account for their potential moderating effects, resulting in the extended specification presented in Eq.\u0026nbsp;(\u003cspan refid=\"Equ4\" class=\"InternalRef\"\u003e4\u003c/span\u003e) as follows:\u003cdiv id=\"Equ4\" class=\"Equation\"\u003e\u003cdiv format=\"TEX\" class=\"mathdisplay\" id=\"FileID_Equ4\" name=\"EquationSource\"\u003e\n$$\\:{ESI}_{it}=\\:{{\\beta\\:}_{0}+{\\beta\\:}_{1}E}_{it}+{{\\beta\\:}_{2}DI}_{it}+{{\\beta\\:}_{3}EG}_{it}+{\\beta\\:}_{4}\\left({E}_{it}\\:\\text{x}\\:{DI}_{it}\\right)+{\\beta\\:}_{5}\\left({E}_{it}\\:\\text{x}\\:{EG}_{it}\\right)+{{\\beta\\:}_{6}Z}_{it}+\\:{\\epsilon\\:}_{it}$$\u003c/div\u003e\u003cdiv class=\"EquationNumber\"\u003e4\u003c/div\u003e\u003c/div\u003e\u003c/p\u003e \u003cp\u003eWhere interaction terms \u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:{E}_{it}\\:\\text{x}\\:{DI}_{it}\\)\u003c/span\u003e\u003c/span\u003e and \u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:{E}_{it}\\:\\text{x}\\:{EG}_{it}\\)\u003c/span\u003e\u003c/span\u003e capture the moderating roles of digital infrastructure and entrepreneurial governance on the relationship between entrepreneurship and sustainable development.\u003c/p\u003e \u003cp\u003eTo estimate the relationships specified in Equations (\u003cspan refid=\"Equ3\" class=\"InternalRef\"\u003e3\u003c/span\u003e) and (\u003cspan refid=\"Equ4\" class=\"InternalRef\"\u003e4\u003c/span\u003e), the empirical analysis begins by addressing two key econometric concerns common in macro-panel data: cross-sectional dependence (CSD) and slope heterogeneity. Given the interconnectedness of countries through trade, investment, and the diffusion of technology, ignoring CSD can lead to biased and inconsistent estimates. Thus, we employ the bias-adjusted LM test proposed by Pesaran et al. (2008) to test for the presence of cross-sectional dependence. In parallel, we assess the validity of the homogeneity assumption in slope coefficients across countries using the Δ̃ (delta tilde) and Δ̃adj (adjusted delta tilde) tests developed by Pesaran and Yamagata (2008). These tests are critical for verifying whether the estimated coefficients should be allowed to vary across cross-sectional units, acknowledging the possibility that institutional structures, entrepreneurial dynamics, and digital infrastructure may affect economic sustainability differently across countries. Given the evidence of cross-sectional dependence and slope heterogeneity in the dataset, we adopt the Augmented Mean Group (AMG) estimator, developed by Eberhardt and Teal (2010) and later refined by Eberhardt (2012). This estimator is particularly suited for heterogeneous panels with unobserved common factors and cross-sectional correlation. The AMG method accommodates country-specific slopes and allows for unobservable common shocks by incorporating a \"common dynamic process\" derived from first-differenced regressions with time dummies. The estimation proceeds in two stages: first, each country's model is estimated in first differences with time dummies capturing the evolution of global shocks; second, the estimated time dummy coefficients are aggregated and introduced as a common factor in the level regressions, producing robust long-run parameter estimates. A significant advantage of AMG is that it does not require prior testing for unit roots or cointegration, as it remains valid regardless of the integration properties of the variables (Bond \u0026amp; Eberhardt, 2013). Moreover, the method provides consistent estimates even in the presence of endogeneity and cross-sectional correlation, making it well-suited to our research context.\u003c/p\u003e \u003c/div\u003e"},{"header":"4. Results and discussion","content":"\u003cp\u003eThe results of the tests for cross-sectional dependence and slope homogeneity are reported in Table\u0026nbsp;\u003cspan refid=\"Tab4\" class=\"InternalRef\"\u003e4\u003c/span\u003e, where the null hypothesis of no cross-sectional dependence is rejected at the 1% significance level. This outcome is expected given the nature of the variables used in this study, particularly those related to entrepreneurship, governance, and digital infrastructure. Emerging economies in the sample are increasingly interconnected through global trade, FDI flows, technology diffusion, and transnational digital platforms, making the presence of spillover effects highly plausible. Moreover, shared institutional frameworks\u0026mdash;such as UNCTAD, the World Bank\u0026rsquo;s Doing Business initiative, and the 2030 Sustainable Development Agenda\u0026mdash;promote convergent policy reforms and governance standards across countries. These dynamics suggest that changes in entrepreneurial environments or digital capacities in one country are likely to influence, or be influenced by, similar shifts in others, validating the existence of cross-sectional interdependence in the panel. Additionally, the null hypothesis of slope homogeneity is also strongly rejected at the 1% level, indicating significant variation in how entrepreneurship and its enabling conditions affect economic sustainability across countries. This result highlights the importance of using estimation methods that do not impose uniform effects across heterogeneous national contexts. Accordingly, the study employs the Augmented Mean Group (AMG) estimator, which explicitly accounts for both cross-sectional dependence and heterogeneous slope coefficients. By doing so, the model enables a more accurate assessment of the long-term relationships between entrepreneurship, institutional and digital enablers, and economic sustainability in emerging economies.\u003c/p\u003e \u003cp\u003eThe results initially present the direct effects of opportunity-driven entrepreneurship, necessity-driven entrepreneurship, and total early-stage entrepreneurial activity on economic sustainability. Following this, the analysis incorporates interaction terms to examine how the relationship between entrepreneurship and economic sustainability is enhanced by promoting entrepreneurial governance and digital infrastructure. To strengthen the robustness of the findings, each model specification is re-estimated using alternative proxies for entrepreneurial governance (such as government integrity, business freedom, and investment freedom) and for digital infrastructure (including ICT use and e-governance).\u003c/p\u003e \u003cp\u003eThe empirical results presented in Table\u0026nbsp;\u003cspan refid=\"Tab5\" class=\"InternalRef\"\u003e5\u003c/span\u003e reveal nuanced and statistically significant relationships between different forms of entrepreneurship and economic sustainability across the five model specifications. Opportunity-driven entrepreneurship (OPE) consistently exhibits a statistically significant and positive impact on economic sustainability, with coefficients ranging from 0.072 to 0.102 and p-values below 0.1 in all models. This positive association aligns with the conceptual understanding of opportunity entrepreneurship as a proactive, innovation-oriented behavior that fosters the creation of new markets, product development, and structural economic transformation (Orde\u0026ntilde;ana et al., \u003cspan citationid=\"CR30\" class=\"CitationRef\"\u003e2024\u003c/span\u003e; Raimi, \u003cspan citationid=\"CR33\" class=\"CitationRef\"\u003e2024\u003c/span\u003e). Such entrepreneurial endeavors contribute to long-term growth by addressing market inefficiencies, enhancing competitiveness, and leveraging innovation\u0026mdash;effects that resonate with Schumpeter\u0026rsquo;s (\u003cspan citationid=\"CR36\" class=\"CitationRef\"\u003e1934\u003c/span\u003e) concept of creative destruction and the endogenous growth framework. Furthermore, the consistent significance of OPE across models supports the argument of Magd et al. (\u003cspan citationid=\"CR25\" class=\"CitationRef\"\u003e2023\u003c/span\u003e), who demonstrate that opportunity-driven entrepreneurship generates economic value in both developed and emerging economies through innovation diffusion, job creation, and economic diversification. These findings also align with Elmonshid and Sayed (\u003cspan citationid=\"CR16\" class=\"CitationRef\"\u003e2024\u003c/span\u003e), who link opportunity entrepreneurship to job creation and social inclusion in Saudi Arabia\u0026rsquo;s Vision 2030, highlighting its role in transforming oil-dependent economies into more resilient and inclusive systems. In contrast, necessity entrepreneurship (NCE) exhibits a consistently negative and statistically significant relationship with economic sustainability across all five model specifications, with coefficients ranging from \u0026minus;\u0026thinsp;0.122 to \u0026minus;\u0026thinsp;0.166 and p-values of less than 0.05. This suggests that necessity-based entrepreneurial activity may hinder long-term sustainability, especially in emerging economies where informal enterprises often dominate. Such businesses are typically established in response to unemployment or poverty, rather than driven by innovation, and therefore often lack scalability, market competitiveness, or sustainable income generation (Raimi, \u003cspan citationid=\"CR33\" class=\"CitationRef\"\u003e2024\u003c/span\u003e; Orde\u0026ntilde;ana et al., \u003cspan citationid=\"CR30\" class=\"CitationRef\"\u003e2024\u003c/span\u003e). These findings corroborate the assertions by Cervell\u0026oacute;-Royo et al. (\u003cspan citationid=\"CR13\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) that without adequate regulatory and macroeconomic support, necessity entrepreneurship often perpetuates economic vulnerability rather than addressing it. Furthermore, Khyareh and Zamani (\u003cspan citationid=\"CR22\" class=\"CitationRef\"\u003e2022\u003c/span\u003e) warn that in weak institutional environments, necessity entrepreneurship may fail to mobilize resources efficiently, reinforcing informal employment and low productivity traps. This distinction highlights the dual nature of entrepreneurship and supports a differentiated policy approach that prioritizes opportunity-driven ventures while addressing the structural causes of necessity entrepreneurship through inclusive labor policies, financial access, and regulatory reform. Regarding the TEA, the estimates are consistently positive but not statistically significant across all five models, with coefficients ranging from 0.069 to 0.104 and p-values above the 10% threshold. These results suggest that TEA, when aggregated without distinguishing between its opportunity and necessity components, fails to exert a measurable impact on economic sustainability. This outcome emphasizes the importance of disaggregating entrepreneurial activity into its underlying motivations and types, as highlighted by Orde\u0026ntilde;ana et al. (\u003cspan citationid=\"CR30\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) and Grandori (\u003cspan citationid=\"CR19\" class=\"CitationRef\"\u003e2024\u003c/span\u003e), who caution against treating entrepreneurship as a monolithic construct. The lack of statistical significance for TEA implies that the combined effect of heterogeneous entrepreneurial motivations may obscure the true impact of entrepreneurial dynamics on long-term development outcomes. Therefore, the findings reaffirm the necessity of more nuanced analyses and targeted policy measures that account for the quality and context of entrepreneurial activity rather than its aggregate volume.\u003c/p\u003e \u003cp\u003e \u003cdiv class=\"gridtable\"\u003e\u003ctable float=\"Yes\" id=\"Tab4\" border=\"1\"\u003e \u003ccaption language=\"En\"\u003e \u003cdiv class=\"CaptionNumber\"\u003eTable 4\u003c/div\u003e \u003cdiv class=\"CaptionContent\"\u003e \u003cp\u003eCross-sectional dependence and homogeneity test results.\u003c/p\u003e \u003c/div\u003e \u003c/caption\u003e \u003ccolgroup cols=\"7\"\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c1\" colnum=\"1\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c2\" colnum=\"2\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c3\" colnum=\"3\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c4\" colnum=\"4\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c5\" colnum=\"5\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c6\" colnum=\"6\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c7\" colnum=\"7\"\u003e\u003c/div\u003e \u003ctbody\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\" morerows=\"1\" rowspan=\"2\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colspan=\"3\" nameend=\"c4\" namest=\"c2\"\u003e \u003cp\u003eCross-sectional dependence\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colspan=\"3\" nameend=\"c7\" namest=\"c5\"\u003e \u003cp\u003eSlope homogeneity\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003eTest\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eStatistic\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003ep-value\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003eTest\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003eStatistic\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e \u003cp\u003ep-value\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\" morerows=\"1\" rowspan=\"2\"\u003e \u003cp\u003eModel 1\u003c/p\u003e \u003cp\u003e(OPE)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\" morerows=\"1\" rowspan=\"2\"\u003e \u003cp\u003eLM\u003csub\u003eadj\u003c/sub\u003e\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\" morerows=\"1\" rowspan=\"2\"\u003e \u003cp\u003e7.128\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\" morerows=\"1\" rowspan=\"2\"\u003e \u003cp\u003e0.000\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e\u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:\\stackrel{\\sim}{\\varDelta\\:}\\)\u003c/span\u003e\u003c/span\u003e\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e10.846\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e \u003cp\u003e0.000\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e\u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:\\stackrel{\\sim}{\\varDelta\\:}\\)\u003c/span\u003e\u003c/span\u003e\u003csub\u003eadj\u003c/sub\u003e\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e12.937\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e \u003cp\u003e0.000\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\" morerows=\"1\" rowspan=\"2\"\u003e \u003cp\u003eModel 2\u003c/p\u003e \u003cp\u003e(NCE)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\" morerows=\"1\" rowspan=\"2\"\u003e \u003cp\u003eLM\u003csub\u003eadj\u003c/sub\u003e\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\" morerows=\"1\" rowspan=\"2\"\u003e \u003cp\u003e6.789\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\" morerows=\"1\" rowspan=\"2\"\u003e \u003cp\u003e0.000\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e\u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:\\stackrel{\\sim}{\\varDelta\\:}\\)\u003c/span\u003e\u003c/span\u003e\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e11.092\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e \u003cp\u003e0.000\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e\u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:\\stackrel{\\sim}{\\varDelta\\:}\\)\u003c/span\u003e\u003c/span\u003e\u003csub\u003eadj\u003c/sub\u003e\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e13.401\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e \u003cp\u003e0.000\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\" morerows=\"1\" rowspan=\"2\"\u003e \u003cp\u003eModel 3\u003c/p\u003e \u003cp\u003e(TEA)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\" morerows=\"1\" rowspan=\"2\"\u003e \u003cp\u003eLM\u003csub\u003eadj\u003c/sub\u003e\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\" morerows=\"1\" rowspan=\"2\"\u003e \u003cp\u003e7.563\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\" morerows=\"1\" rowspan=\"2\"\u003e \u003cp\u003e0.000\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e\u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:\\stackrel{\\sim}{\\varDelta\\:}\\)\u003c/span\u003e\u003c/span\u003e\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e12.223\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e \u003cp\u003e0.000\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e\u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:\\stackrel{\\sim}{\\varDelta\\:}\\)\u003c/span\u003e\u003c/span\u003e\u003csub\u003eadj\u003c/sub\u003e\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e14.104\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c7\"\u003e \u003cp\u003e0.000\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003c/tbody\u003e \u003c/colgroup\u003e \u003c/table\u003e\u003c/div\u003e \u003c/p\u003e \u003cp\u003e \u003cdiv class=\"gridtable\"\u003e\u003ctable float=\"Yes\" id=\"Tab5\" border=\"1\"\u003e \u003ccaption language=\"En\"\u003e \u003cdiv class=\"CaptionNumber\"\u003eTable 5\u003c/div\u003e \u003cdiv class=\"CaptionContent\"\u003e \u003cp\u003eResults of the direct effects of entrepreneurship on economic sustainability.\u003c/p\u003e \u003c/div\u003e \u003c/caption\u003e \u003ccolgroup cols=\"6\"\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c1\" colnum=\"1\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c2\" colnum=\"2\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c3\" colnum=\"3\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c4\" colnum=\"4\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c5\" colnum=\"5\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c6\" colnum=\"6\"\u003e\u003c/div\u003e \u003cthead\u003e \u003ctr\u003e \u003cth align=\"left\" colname=\"c1\" morerows=\"2\" rowspan=\"3\"\u003e\u0026nbsp;\u003c/th\u003e \u003cth align=\"left\" colspan=\"5\" nameend=\"c6\" namest=\"c2\"\u003e \u003cp\u003eEconomic Sustainability\u003c/p\u003e \u003c/th\u003e \u003c/tr\u003e \u003ctr\u003e \u003cth align=\"left\" colspan=\"2\" nameend=\"c3\" namest=\"c2\"\u003e \u003cp\u003eDigital Infrastructure\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colspan=\"3\" nameend=\"c6\" namest=\"c4\"\u003e \u003cp\u003eEntrepreneurial governance\u003c/p\u003e \u003c/th\u003e \u003c/tr\u003e \u003ctr\u003e \u003cth align=\"left\" colname=\"c2\"\u003e \u003cp\u003e1\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c3\"\u003e \u003cp\u003e2\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c4\"\u003e \u003cp\u003e3\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c5\"\u003e \u003cp\u003e4\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c6\"\u003e \u003cp\u003e5\u003c/p\u003e \u003c/th\u003e \u003c/tr\u003e \u003c/thead\u003e \u003ctbody\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eOpportunity entrepreneurship (OPE)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.095**\u003c/p\u003e \u003cp\u003e(0.011)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e0.102***\u003c/p\u003e \u003cp\u003e(0.002)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e0.088*\u003c/p\u003e \u003cp\u003e(0.055)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.072*\u003c/p\u003e \u003cp\u003e(0.061)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.100**\u003c/p\u003e \u003cp\u003e(0.026)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eNecessity entrepreneurship(NCE)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e-0.125**\u003c/p\u003e \u003cp\u003e(0.030)\u003c/p\u003e\u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e-0.139***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e\u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e-0.122**\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e\u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e-0.166***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e\u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e-0.141***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e\u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eTEA\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.094\u003c/p\u003e \u003cp\u003e(0.125)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e0.104\u003c/p\u003e \u003cp\u003e(0.114)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e0.069\u003c/p\u003e \u003cp\u003e(0.237)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.080\u003c/p\u003e \u003cp\u003e(0.149)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.094\u003c/p\u003e \u003cp\u003e(0.127)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eE-governance (EGDI)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.181***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eICT\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e0.144**\u003c/p\u003e \u003cp\u003e(0.010)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eGovernment integrity (GovI)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e0.156***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eBusiness freedom (BusF)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.141***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eInvestment freedom (InvF)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.118**\u003c/p\u003e \u003cp\u003e(0.020)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eTrade\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.107\u003c/p\u003e \u003cp\u003e(0.111)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e0.094\u003c/p\u003e \u003cp\u003e(0.133)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e0.113\u003c/p\u003e \u003cp\u003e(0.100)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.083\u003c/p\u003e \u003cp\u003e(0.123)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.101\u003c/p\u003e \u003cp\u003e(0.115)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eFinancial development\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.119**\u003c/p\u003e \u003cp\u003e(0.016)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e0.099**\u003c/p\u003e \u003cp\u003e(0.037)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e0.104**\u003c/p\u003e \u003cp\u003e(0.023)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.089*\u003c/p\u003e \u003cp\u003e(0.055)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.121***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eRule of law\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.161***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e0.186***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e0.157***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.170***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.169***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eConstant\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.459***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e0.649***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e0.329***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.387***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.441***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003c/tbody\u003e \u003c/colgroup\u003e \u003ctfoot\u003e \u003ctr\u003e\u003ctd colspan=\"6\"\u003e\u003cem\u003eNote\u003c/em\u003e: Columns 1 and include the digitalization indicators (including E-governance and ICT use) and columns 3 to 5 include the entrepreneurial governance indicators (including government integrity, business freedom, and investment freedom). *p\u0026thinsp;\u0026lt;\u0026thinsp;0.1, **p\u0026thinsp;\u0026lt;\u0026thinsp;0.05, and ***p\u0026thinsp;\u0026lt;\u0026thinsp;0.01.\u003c/td\u003e\u003c/tr\u003e \u003c/tfoot\u003e \u003c/table\u003e\u003c/div\u003e \u003c/p\u003e \u003cp\u003eThe role of digital infrastructure is also examined through two indicators: e-governance (EGDI) and ICT usage. The results reveal strong and statistically significant effects for both variables. E-governance exhibits a positive and highly significant association with economic sustainability, with a coefficient of 0.181 (p\u0026thinsp;\u0026lt;\u0026thinsp;0.01). Additionally, ICT usage also shows a significant effect, with a coefficient of 0.144 (p\u0026thinsp;\u0026lt;\u0026thinsp;0.05). These findings are consistent with theoretical expectations derived from the Resource-Based View (Barney, \u003cspan citationid=\"CR8\" class=\"CitationRef\"\u003e1991\u003c/span\u003e; Wernerfelt, \u003cspan citationid=\"CR44\" class=\"CitationRef\"\u003e1984\u003c/span\u003e), which views digital infrastructure as a strategic and scarce resource that enhances information access, reduces transaction costs, and supports innovation and productivity gains. Li et al. (\u003cspan citationid=\"CR24\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) and Schade and Schuhmacher (\u003cspan citationid=\"CR35\" class=\"CitationRef\"\u003e2022\u003c/span\u003e) emphasize that digital platforms act as external enablers, particularly for underrepresented groups, by lowering entry barriers and promoting entrepreneurial action formation. Moreover, Xu et al. (\u003cspan citationid=\"CR48\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) demonstrate that digital governance enhances entrepreneurship through administrative efficiency and expanded market access, especially in remote and underserved regions such as rural China and Tibet. These effects are particularly relevant for emerging economies, where infrastructural asymmetries can significantly constrain entrepreneurial potential. Thus, the empirical results validate the theoretical expectation that digital infrastructure, particularly when institutionalized through e-governance and ICT, plays a catalytic role in aligning entrepreneurship with long-term economic sustainability objectives.\u003c/p\u003e \u003cp\u003eTurning to entrepreneurial governance, the indicators of government integrity, business freedom, and investment freedom are all positively and significantly associated with economic sustainability, with coefficients ranging from 0.118 to 0.156 across the models. Specifically, government integrity exhibits the highest impact (0.156, p\u0026thinsp;\u0026lt;\u0026thinsp;0.01), followed by business freedom (0.141, p\u0026thinsp;\u0026lt;\u0026thinsp;0.01), and investment freedom (0.118, p\u0026thinsp;\u0026lt;\u0026thinsp;0.05). These results align with the arguments advanced by institutional theory (Scott, \u003cspan citationid=\"CR37\" class=\"CitationRef\"\u003e1995\u003c/span\u003e; North, \u003cspan citationid=\"CR28\" class=\"CitationRef\"\u003e1990\u003c/span\u003e), which emphasizes the importance of transparent, predictable, and inclusive governance systems in promoting entrepreneurship and economic development. Raimi and Haini (\u003cspan citationid=\"CR33\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) find that normative elements of governance, such as accountability and regulatory quality, play a decisive role in enabling entrepreneurial ecosystems to flourish, particularly in fragile contexts. The positive and significant effects of these variables suggest that entrepreneurial governance mechanisms not only reduce risk and uncertainty but also enhance resource allocation, stimulate investment, and improve institutional trust\u0026mdash;essential conditions for sustainable entrepreneurship. These findings support Grandori\u0026rsquo;s (\u003cspan citationid=\"CR19\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) conceptualization of entrepreneurial governance as a hybrid institutional framework that promotes adaptive innovation, public-private collaboration, and inclusive development. Similarly, Olsson et al. (\u003cspan citationid=\"CR29\" class=\"CitationRef\"\u003e2020\u003c/span\u003e) demonstrate that governance structures that encourage discovery opportunity and resource mobilization yield resilient and scalable ventures, even in peripheral regions. Therefore, the results highlight that robust governance frameworks are indispensable for ensuring that entrepreneurship contributes to resilient and equitable economic systems in emerging economies.\u003c/p\u003e \u003cp\u003eTo understand how entrepreneurship contributes to economic sustainability in emerging economies, it is crucial to examine the mechanisms that shape this relationship. In this study, special attention is given to the moderating roles of digital infrastructure and entrepreneurial governance. Specifically, we focus on how the effects of entrepreneurship on economic sustainability vary under different levels of these moderator variables. We assess whether the positive or negative impacts of opportunity-driven, necessity-driven, and total entrepreneurial activity change in magnitude or direction when conditioned by digital infrastructure and entrepreneurial governance. This analytical framework draws on insights from the Resource-Based Theory and institutional theory, as emphasized in the works of Barney (\u003cspan citationid=\"CR8\" class=\"CitationRef\"\u003e1991\u003c/span\u003e) and Li et al. (\u003cspan citationid=\"CR24\" class=\"CitationRef\"\u003e2024\u003c/span\u003e). Tables\u0026nbsp;\u003cspan refid=\"Tab6\" class=\"InternalRef\"\u003e6\u003c/span\u003e, \u003cspan refid=\"Tab7\" class=\"InternalRef\"\u003e7\u003c/span\u003e, and \u003cspan refid=\"Tab8\" class=\"InternalRef\"\u003e8\u003c/span\u003e present the interaction results, where columns 1 and 2 display the moderating effects of digital infrastructure, and columns 3\u0026ndash;5 report the moderating roles of entrepreneurial governance. By estimating these interaction terms, the study aims to uncover context-specific dynamics that shape the effectiveness of entrepreneurship as a tool for sustainable economic transformation. This approach not only enhances the theoretical integration of institutional and technological enablers but also provides policy-relevant insights into how supportive environments can amplify the developmental impact of entrepreneurship.\u003c/p\u003e \u003cp\u003eBased on the results presented in Tables\u0026nbsp;\u003cspan refid=\"Tab6\" class=\"InternalRef\"\u003e6\u003c/span\u003e to \u003cspan refid=\"Tab8\" class=\"InternalRef\"\u003e8\u003c/span\u003e, the inclusion of moderator variables\u0026mdash;digital infrastructure and entrepreneurial governance\u0026mdash;offers a deeper insight into how various types of entrepreneurship interact with the enabling environment to shape economic sustainability. Focusing first on opportunity-driven entrepreneurship (OPE), the findings show that its interaction with digital infrastructure significantly amplifies its impact on economic sustainability. Specifically, the interaction between OPE and e-governance (EGDI) yields a strong positive effect of 0.133, while the interaction with ICT infrastructure is also significant at 0.126. These results clearly suggest that when opportunity entrepreneurship is supported by robust digital systems, its ability to contribute to economic outcomes improves considerably. This aligns with previous studies emphasizing the digital ecosystem\u0026rsquo;s enabling role (Li et al., \u003cspan citationid=\"CR24\" class=\"CitationRef\"\u003e2024\u003c/span\u003e; Xiong et al., \u003cspan citationid=\"CR47\" class=\"CitationRef\"\u003e2024\u003c/span\u003e; Gomes \u0026amp; Lopes, \u003cspan citationid=\"CR18\" class=\"CitationRef\"\u003e2022\u003c/span\u003e). Moreover, the moderating role of entrepreneurial governance\u0026mdash;comprising government integrity, business freedom, and investment freedom\u0026mdash;further reinforces this relationship. The interaction between OPE and government integrity shows a coefficient of 0.148, while interactions with business freedom and investment freedom yield coefficients of 0.151 and 0.139, respectively. These effects are not only statistically significant at the 1% level but also larger than the direct effect of OPE reported in Table\u0026nbsp;\u003cspan refid=\"Tab5\" class=\"InternalRef\"\u003e5\u003c/span\u003e (ranging from 0.072 to 0.102), confirming that governance environments characterized by transparency, regulatory quality, and policy consistency strengthen the role of opportunity-driven entrepreneurship in achieving economic sustainability. These findings are consistent with Raimi and Haini (\u003cspan citationid=\"CR33\" class=\"CitationRef\"\u003e2024\u003c/span\u003e), who argue that when entrepreneurial activity operates under well-functioning institutions, its developmental potential is magnified. Thus, the results provide empirical validation for the hypothesis that institutional and technological enablers\u0026mdash;particularly digital infrastructure and governance\u0026mdash;serve as crucial amplifiers for OPE-led development trajectories in emerging economies.\u003c/p\u003e \u003cp\u003eIn contrast, necessity entrepreneurship (NCE) presents a complex interaction with economic sustainability that varies significantly depending on the enabling environment. Table\u0026nbsp;\u003cspan refid=\"Tab5\" class=\"InternalRef\"\u003e5\u003c/span\u003e previously showed that the direct effect of NCE on economic sustainability is significantly negative, with coefficients ranging from \u0026minus;\u0026thinsp;0.122 to \u0026minus;\u0026thinsp;0.166. However, the interaction results in Table\u0026nbsp;\u003cspan refid=\"Tab7\" class=\"InternalRef\"\u003e7\u003c/span\u003e reveal that digital infrastructure fails to mitigate this negative influence, as neither the EGDI (0.058) nor the ICT (0.070) interaction is statistically significant. This suggests that while digital infrastructure can support opportunity entrepreneurship, it does not effectively neutralize the constraints or inefficiencies associated with necessity-driven ventures, possibly due to structural barriers such as low human capital, informal operations, or resource scarcity. Interestingly, when NCE interacts with entrepreneurial governance components, some of the adverse effects are significantly reduced. The interaction with government integrity yields a coefficient of 0.099 (significant at the 5% level), and the interaction with business freedom produces an even stronger effect at 0.106 (significant at the 1% level). These findings demonstrate that governance mechanisms\u0026mdash;through the reduction of transaction costs, policy clarity, and rule of law\u0026mdash;can partly counterbalance the negative externalities associated with necessity entrepreneurship. This supports M\u0026eacute;ndez-Picazo et al. (\u003cspan citationid=\"CR26\" class=\"CitationRef\"\u003e2012\u003c/span\u003e) and Abegaz et al. (\u003cspan citationid=\"CR1\" class=\"CitationRef\"\u003e2023\u003c/span\u003e), who argue that effective governance systems not only inspire productive entrepreneurship but can also transform survival-based ventures into more formalized and efficient economic actors. Although investment freedom does not yield a statistically significant moderating effect (0.093), the results overall underline the crucial role of institutional quality in redefining the economic trajectory of necessity-based entrepreneurial efforts. Thus, while necessity entrepreneurship alone may be insufficient or even counterproductive in promoting sustainability, its outcomes can be redirected under conducive governance conditions.\u003c/p\u003e \u003cp\u003e \u003cdiv class=\"gridtable\"\u003e\u003ctable float=\"Yes\" id=\"Tab6\" border=\"1\"\u003e \u003ccaption language=\"En\"\u003e \u003cdiv class=\"CaptionNumber\"\u003eTable 6\u003c/div\u003e \u003cdiv class=\"CaptionContent\"\u003e \u003cp\u003eResults of the indirect effects of opportunity entrepreneurship on economic sustainability.\u003c/p\u003e \u003c/div\u003e \u003c/caption\u003e \u003ccolgroup cols=\"6\"\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c1\" colnum=\"1\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c2\" colnum=\"2\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c3\" colnum=\"3\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c4\" colnum=\"4\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c5\" colnum=\"5\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c6\" colnum=\"6\"\u003e\u003c/div\u003e \u003cthead\u003e \u003ctr\u003e \u003cth align=\"left\" colname=\"c1\" morerows=\"3\" rowspan=\"4\"\u003e\u0026nbsp;\u003c/th\u003e \u003cth align=\"left\" colspan=\"5\" nameend=\"c6\" namest=\"c2\"\u003e \u003cp\u003eDependent variable: Economic Sustainability\u003c/p\u003e \u003c/th\u003e \u003c/tr\u003e \u003ctr\u003e \u003cth align=\"left\" colspan=\"5\" nameend=\"c6\" namest=\"c2\"\u003e \u003cp\u003eOpportunity entrepreneurship (OPE)\u003c/p\u003e \u003c/th\u003e \u003c/tr\u003e \u003ctr\u003e \u003cth align=\"left\" colspan=\"2\" nameend=\"c3\" namest=\"c2\"\u003e \u003cp\u003eDigital Infrastructure\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colspan=\"3\" nameend=\"c6\" namest=\"c4\"\u003e \u003cp\u003eEntrepreneurial governance\u003c/p\u003e \u003c/th\u003e \u003c/tr\u003e \u003ctr\u003e \u003cth align=\"left\" colname=\"c2\"\u003e \u003cp\u003e1\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c3\"\u003e \u003cp\u003e2\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c4\"\u003e \u003cp\u003e3\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c5\"\u003e \u003cp\u003e4\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c6\"\u003e \u003cp\u003e5\u003c/p\u003e \u003c/th\u003e \u003c/tr\u003e \u003c/thead\u003e \u003ctbody\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eEGDI \u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:\\text{x}\\)\u003c/span\u003e\u003c/span\u003e OPE\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.133***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eICT \u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:\\text{x}\\)\u003c/span\u003e\u003c/span\u003e OPE\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e0.126**\u003c/p\u003e \u003cp\u003e(0.032)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eGovI \u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:\\text{x}\\)\u003c/span\u003e\u003c/span\u003e OPE\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e0.148***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eBusF \u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:\\text{x}\\)\u003c/span\u003e\u003c/span\u003e OPE\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.151***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eInvF \u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:\\text{x}\\)\u003c/span\u003e\u003c/span\u003e OPE\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.139***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eTrade\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.087\u003c/p\u003e \u003cp\u003e(0.135)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e0.099\u003c/p\u003e \u003cp\u003e(0.117)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e0.111\u003c/p\u003e \u003cp\u003e(0.108)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.104\u003c/p\u003e \u003cp\u003e(0.119)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.076\u003c/p\u003e \u003cp\u003e(0.163)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eFinancial development\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.144***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e0.129***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e0.152***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.122**\u003c/p\u003e \u003cp\u003e(0.018)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.135***\u003c/p\u003e \u003cp\u003e(0.001)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eRule of law\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.166***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e0.151***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e0.149***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.166***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.173***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eConstant\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.289***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e0.196***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e0.328***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.536***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.407***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003c/tbody\u003e \u003c/colgroup\u003e \u003ctfoot\u003e \u003ctr\u003e\u003ctd colspan=\"6\"\u003e\u003cem\u003eNote\u003c/em\u003e: Columns 1 and include the digitalization indicators (including E-governance and ICT use), and columns 3 to 5 include the entrepreneurial governance indicators (including government integrity, business freedom, and investment freedom). ***p\u0026thinsp;\u0026lt;\u0026thinsp;0.1, **p\u0026thinsp;\u0026lt;\u0026thinsp;0.05, and *p\u0026thinsp;\u0026lt;\u0026thinsp;0.01.\u003c/td\u003e\u003c/tr\u003e \u003c/tfoot\u003e \u003c/table\u003e\u003c/div\u003e \u003c/p\u003e \u003cp\u003e \u003cdiv class=\"gridtable\"\u003e\u003ctable float=\"Yes\" id=\"Tab7\" border=\"1\"\u003e \u003ccaption language=\"En\"\u003e \u003cdiv class=\"CaptionNumber\"\u003eTable 7\u003c/div\u003e \u003cdiv class=\"CaptionContent\"\u003e \u003cp\u003eResults of the Indirect Effects of Necessity Entrepreneurship on Economic Sustainability.\u003c/p\u003e \u003c/div\u003e \u003c/caption\u003e \u003ccolgroup cols=\"6\"\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c1\" colnum=\"1\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c2\" colnum=\"2\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c3\" colnum=\"3\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c4\" colnum=\"4\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c5\" colnum=\"5\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c6\" colnum=\"6\"\u003e\u003c/div\u003e \u003cthead\u003e \u003ctr\u003e \u003cth align=\"left\" colname=\"c1\" morerows=\"3\" rowspan=\"4\"\u003e\u0026nbsp;\u003c/th\u003e \u003cth align=\"left\" colspan=\"5\" nameend=\"c6\" namest=\"c2\"\u003e \u003cp\u003eDependent variable: Economic Sustainability\u003c/p\u003e \u003c/th\u003e \u003c/tr\u003e \u003ctr\u003e \u003cth align=\"left\" colspan=\"5\" nameend=\"c6\" namest=\"c2\"\u003e \u003cp\u003eNecessity entrepreneurship (NPE)\u003c/p\u003e \u003c/th\u003e \u003c/tr\u003e \u003ctr\u003e \u003cth align=\"left\" colspan=\"2\" nameend=\"c3\" namest=\"c2\"\u003e \u003cp\u003eDigital Infrastructure\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colspan=\"3\" nameend=\"c6\" namest=\"c4\"\u003e \u003cp\u003eEntrepreneurial governance\u003c/p\u003e \u003c/th\u003e \u003c/tr\u003e \u003ctr\u003e \u003cth align=\"left\" colname=\"c2\"\u003e \u003cp\u003e1\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c3\"\u003e \u003cp\u003e2\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c4\"\u003e \u003cp\u003e3\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c5\"\u003e \u003cp\u003e4\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c6\"\u003e \u003cp\u003e5\u003c/p\u003e \u003c/th\u003e \u003c/tr\u003e \u003c/thead\u003e \u003ctbody\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eEGDI \u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:\\text{x}\\)\u003c/span\u003e\u003c/span\u003e NCE\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.058\u003c/p\u003e \u003cp\u003e(0.179)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eICT \u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:\\text{x}\\)\u003c/span\u003e\u003c/span\u003e NCE\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e0.070\u003c/p\u003e \u003cp\u003e(0.143)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eGovI \u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:\\text{x}\\)\u003c/span\u003e\u003c/span\u003e NCE\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e0.099**\u003c/p\u003e \u003cp\u003e(0.012)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eBusF \u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:\\text{x}\\)\u003c/span\u003e\u003c/span\u003e NCE\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.106***\u003c/p\u003e \u003cp\u003e(0.002)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eInvF \u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:\\text{x}\\)\u003c/span\u003e\u003c/span\u003e NCE\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.093\u003c/p\u003e \u003cp\u003e(0.100)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eTrade\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.120\u003c/p\u003e \u003cp\u003e(0.102)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e0.107\u003c/p\u003e \u003cp\u003e(0.117)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e0.093\u003c/p\u003e \u003cp\u003e(0.126)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.101\u003c/p\u003e \u003cp\u003e(0.137)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.090\u003c/p\u003e \u003cp\u003e(0.104)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eFinancial development\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.110**\u003c/p\u003e \u003cp\u003e(0.028)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e0.126***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e0.114**\u003c/p\u003e \u003cp\u003e(0.040)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.139***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.129***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eRule of law\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.144***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e0.150***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e0.139***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.152***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.162***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eConstant\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.644***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e0.593***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e0.628***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.477***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.387***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003c/tbody\u003e \u003c/colgroup\u003e \u003ctfoot\u003e \u003ctr\u003e\u003ctd colspan=\"6\"\u003e\u003cem\u003eNote\u003c/em\u003e: Columns 1 and include the digitalization indicators (including E-governance and ICT use), and columns 3 to 5 include the entrepreneurial governance indicators (including government integrity, business freedom, and investment freedom). ***p\u0026thinsp;\u0026lt;\u0026thinsp;0.1, **p\u0026thinsp;\u0026lt;\u0026thinsp;0.05, and *p\u0026thinsp;\u0026lt;\u0026thinsp;0.01.\u003c/td\u003e\u003c/tr\u003e \u003c/tfoot\u003e \u003c/table\u003e\u003c/div\u003e \u003c/p\u003e \u003cp\u003e \u003cdiv class=\"gridtable\"\u003e\u003ctable float=\"Yes\" id=\"Tab8\" border=\"1\"\u003e \u003ccaption language=\"En\"\u003e \u003cdiv class=\"CaptionNumber\"\u003eTable 8\u003c/div\u003e \u003cdiv class=\"CaptionContent\"\u003e \u003cp\u003eResults of the indirect effects of total early-stage entrepreneurship on economic sustainability.\u003c/p\u003e \u003c/div\u003e \u003c/caption\u003e \u003ccolgroup cols=\"6\"\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c1\" colnum=\"1\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c2\" colnum=\"2\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c3\" colnum=\"3\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c4\" colnum=\"4\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c5\" colnum=\"5\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c6\" colnum=\"6\"\u003e\u003c/div\u003e \u003cthead\u003e \u003ctr\u003e \u003cth align=\"left\" colname=\"c1\" morerows=\"3\" rowspan=\"4\"\u003e\u0026nbsp;\u003c/th\u003e \u003cth align=\"left\" colspan=\"5\" nameend=\"c6\" namest=\"c2\"\u003e \u003cp\u003eDependent variable: Economic Sustainability\u003c/p\u003e \u003c/th\u003e \u003c/tr\u003e \u003ctr\u003e \u003cth align=\"left\" colspan=\"5\" nameend=\"c6\" namest=\"c2\"\u003e \u003cp\u003eTotal early-stage entrepreneurship (TEA)\u003c/p\u003e \u003c/th\u003e \u003c/tr\u003e \u003ctr\u003e \u003cth align=\"left\" colspan=\"2\" nameend=\"c3\" namest=\"c2\"\u003e \u003cp\u003eDigital Infrastructure\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colspan=\"3\" nameend=\"c6\" namest=\"c4\"\u003e \u003cp\u003eEntrepreneurial governance\u003c/p\u003e \u003c/th\u003e \u003c/tr\u003e \u003ctr\u003e \u003cth align=\"left\" colname=\"c2\"\u003e \u003cp\u003e1\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c3\"\u003e \u003cp\u003e2\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c4\"\u003e \u003cp\u003e3\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c5\"\u003e \u003cp\u003e4\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c6\"\u003e \u003cp\u003e5\u003c/p\u003e \u003c/th\u003e \u003c/tr\u003e \u003c/thead\u003e \u003ctbody\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eEGDI \u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:\\text{x}\\)\u003c/span\u003e\u003c/span\u003e TEA\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.130***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eICT \u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:\\text{x}\\)\u003c/span\u003e\u003c/span\u003e TEA\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e0.121**\u003c/p\u003e \u003cp\u003e(0.025)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eGovI \u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:\\text{x}\\)\u003c/span\u003e\u003c/span\u003e TEA\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e0.119*\u003c/p\u003e \u003cp\u003e(0.050)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eBusF \u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:\\text{x}\\)\u003c/span\u003e\u003c/span\u003e TEA\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.133***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eInvF \u003cspan class=\"InlineEquation\"\u003e\u003cspan class=\"mathinline\"\u003e\\(\\:\\text{x}\\)\u003c/span\u003e\u003c/span\u003e TEA\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.129**\u003c/p\u003e \u003cp\u003e(0.016)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eTrade\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.080\u003c/p\u003e \u003cp\u003e(0.122)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e0.117**\u003c/p\u003e \u003cp\u003e(0.023)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e0.102\u003c/p\u003e \u003cp\u003e(0.129)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.113\u003c/p\u003e \u003cp\u003e(0.103)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.084\u003c/p\u003e \u003cp\u003e(0.117)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eFinancial development\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.149***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e0.129***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e0.124**\u003c/p\u003e \u003cp\u003e(0.029)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.119**\u003c/p\u003e \u003cp\u003e(0.014)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.130***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eRule of law\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.170***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e0.155***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e0.161***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.159***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.144***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eConstant\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e0.337***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003e0.409***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e0.322***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003e0.503***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c6\"\u003e \u003cp\u003e0.440***\u003c/p\u003e \u003cp\u003e(0.000)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003c/tbody\u003e \u003c/colgroup\u003e \u003ctfoot\u003e \u003ctr\u003e\u003ctd colspan=\"6\"\u003e\u003cem\u003eNote\u003c/em\u003e: Columns 1 and include the digitalization indicators (including E-governance and ICT use), and columns 3 to 5 include the entrepreneurial governance indicators (including government integrity, business freedom, and investment freedom). ***p\u0026thinsp;\u0026lt;\u0026thinsp;0.1, **p\u0026thinsp;\u0026lt;\u0026thinsp;0.05, and *p\u0026thinsp;\u0026lt;\u0026thinsp;0.01.\u003c/td\u003e\u003c/tr\u003e \u003c/tfoot\u003e \u003c/table\u003e\u003c/div\u003e \u003c/p\u003e \u003cp\u003eTurning to total early-stage entrepreneurial activity (TEA), Table\u0026nbsp;\u003cspan refid=\"Tab5\" class=\"InternalRef\"\u003e5\u003c/span\u003e previously reported no statistically significant effects across all specifications, with coefficients ranging from 0.069 to 0.104. However, the interaction results in Table\u0026nbsp;\u003cspan refid=\"Tab8\" class=\"InternalRef\"\u003e8\u003c/span\u003e highlight that the introduction of moderating variables leads to substantial and statistically significant improvements in TEA\u0026rsquo;s contribution to economic sustainability. Specifically, when TEA interacts with digital infrastructure, the results become both robust and significant: EGDI \u0026times; TEA produces a coefficient of 0.130, while ICT \u0026times; TEA yields 0.121. These findings demonstrate that, although TEA may not inherently lead to economic sustainability, its effectiveness dramatically improves in digitally connected environments. The empirical support from Hussain et al. (\u003cspan citationid=\"CR21\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) and Schade and Schuhmacher (\u003cspan citationid=\"CR35\" class=\"CitationRef\"\u003e2022\u003c/span\u003e) reinforces this notion by showing that digitalization enhances entrepreneurial capabilities and innovation performance, which are essential for sustainable growth. Similarly, the role of entrepreneurial governance proves pivotal. The interaction between TEA and government integrity is positive and statistically significant at 0.119, business freedom at 0.133, and investment freedom at 0.129. These values exceed the direct effects reported in Table\u0026nbsp;\u003cspan refid=\"Tab5\" class=\"InternalRef\"\u003e5\u003c/span\u003e, indicating that the institutional environment enhances TEA's effectiveness in achieving sustainable economic outcomes. These results substantiate the theoretical claims of North (\u003cspan citationid=\"CR28\" class=\"CitationRef\"\u003e1990\u003c/span\u003e) and Scott (\u003cspan citationid=\"CR37\" class=\"CitationRef\"\u003e1995\u003c/span\u003e), who argue that institutional settings shape entrepreneurial efficacy by providing a stable and predictable environment for business operations. Moreover, these findings are echoed in the empirical results of Olsson et al. (\u003cspan citationid=\"CR29\" class=\"CitationRef\"\u003e2020\u003c/span\u003e), who highlight that local entrepreneurial governance systems in Sweden contribute to employment growth and regional resilience. Therefore, while TEA in isolation may lack a strong influence, it becomes a key driver of sustainability when supported by the dual enablers of governance and digital infrastructure, thereby fulfilling the theoretical premise of resource-based and institutional theories.\u003c/p\u003e \u003cp\u003eTo summarize, as shown in Figs.\u0026nbsp;\u003cspan refid=\"Fig2\" class=\"InternalRef\"\u003e2\u003c/span\u003e and \u003cspan refid=\"Fig3\" class=\"InternalRef\"\u003e3\u003c/span\u003e, the interaction models emphasize the significance of contextual enablers\u0026mdash;specifically, digital infrastructure and entrepreneurial governance\u0026mdash;in influencing the effectiveness of entrepreneurial activity in promoting economic sustainability. Opportunity entrepreneurship, which already exhibits a positive impact, is significantly amplified in the presence of these moderators. Necessity entrepreneurship, though inherently negative in its direct influence, can be rehabilitated through strong governance mechanisms, highlighting the adaptive role of institutions in steering informal or survivalist enterprises toward productive outcomes. Meanwhile, TEA, initially insignificant in its direct effect, becomes economically meaningful when supported by both technological and institutional infrastructures. These findings collectively demonstrate that entrepreneurship does not operate in a vacuum; rather, its contribution to sustainable development is highly contingent upon the quality of the surrounding ecosystem. This supports the multidimensional argument that sustainable entrepreneurship is both a function of individual agency and structural context. Therefore, policymakers in emerging economies aiming to harness entrepreneurship as a catalyst for sustainability must prioritize investments in digital infrastructure and institutional reform. Such efforts will not only maximize the developmental impact of entrepreneurship but also foster inclusive, resilient, and sustainable growth trajectories that are responsive to the challenges of the 21st century.\u003c/p\u003e \u003cp\u003e \u003c/p\u003e \u003cp\u003e \u003c/p\u003e"},{"header":"5. Conclusion and implications","content":"\u003cp\u003eThis study aimed to investigate the role of entrepreneurship in promoting economic sustainability in emerging economies and to examine the extent to which this contribution is influenced by digital infrastructure and entrepreneurial governance. Drawing on theoretical underpinnings from the Resource-Based Theory and Institutional Theory, the research focused on identifying the conditional impact of three distinct forms of entrepreneurship\u0026mdash;opportunity-driven, necessity-driven, and total early-stage entrepreneurial activity\u0026mdash;on economic sustainability. The empirical analysis was based on a balanced panel of 16 emerging economies spanning the period from 2004 to 2021. The methodology employed interaction models to explore the moderating influence of key institutional and technological factors\u0026mdash;specifically, digital infrastructure (measured by EGDI and ICT access) and entrepreneurial governance (proxied by government integrity, business freedom, and investment freedom). By incorporating these interactions, the study aimed to elucidate the transmission mechanisms through which entrepreneurship influences long-term economic sustainability under varying contextual conditions. The results demonstrate that opportunity-driven entrepreneurship is a significant driver of economic sustainability in emerging economies, particularly when supported by high-quality digital infrastructure and effective governance structures. These enabling conditions enhance the effectiveness of entrepreneurial activities by facilitating market access, reducing transaction costs, and enhancing institutional trust. In contrast, necessity-driven entrepreneurship exhibits a negative direct effect on economic sustainability; however, this adverse influence can be mitigated through robust entrepreneurial governance. Notably, digital infrastructure alone does not sufficiently moderate the negative impact of necessity entrepreneurship, emphasizing the central role of governance reforms in shifting necessity-based ventures toward more sustainable economic outcomes. Furthermore, total early-stage entrepreneurial activity, which displayed no significant direct effect on sustainability in the base models, becomes positively significant when contextualized through digital and governance moderators. This suggests that the broader entrepreneurial environment\u0026mdash;particularly the quality of digital and institutional infrastructures\u0026mdash;determines whether entrepreneurial activity results in sustainable economic benefits.\u003c/p\u003e \u003cp\u003eThe findings carry significant policy and practical implications for stakeholders seeking to enhance the sustainability outcomes of entrepreneurship in emerging economies. First, investment in digital infrastructure should be a national priority. Governments must expand broadband coverage, mobile penetration, and ICT accessibility to foster an inclusive digital ecosystem. Such investments can lower entry barriers, facilitate the diffusion of innovation, and enable resource-poor entrepreneurs to leverage digital tools for business scalability and market integration. Policymakers should also promote public-private partnerships to develop smart infrastructure and digital literacy programs, particularly in underserved and rural areas, where opportunity-driven entrepreneurship can have a transformative impact. Second, entrepreneurial governance reforms are essential. Governments must streamline regulatory frameworks, reduce bureaucratic red tape, and enhance the predictability and transparency of business-related procedures. Improving the rule of law, curbing corruption, and safeguarding property rights are equally vital to building investor and entrepreneurial confidence. Specific policies that incentivize business formalization, such as tax incentives, start-up support centers, and fast-track licensing schemes, should be implemented. Entrepreneurial governance should also encompass institutional frameworks that foster inclusive entrepreneurship, encouraging youth, women, and marginalized groups to participate in innovation-driven ventures. Third, it is essential to adopt a systems-thinking approach by designing policy interventions that simultaneously strengthen both digital and governance infrastructures. For instance, integrated e-governance platforms that combine digital service delivery with regulatory simplification can enhance the quality of the business environment while leveraging technology. Additionally, capacity-building programs focused on entrepreneurial competencies, digital marketing, and innovation management can ensure that emerging entrepreneurs have the skills needed to thrive in evolving ecosystems. Development agencies and educational institutions should collaborate to foster entrepreneurial mindsets that align with the Sustainable Development Goals. Ultimately, empirical monitoring systems should be institutionalized to track the effectiveness of these interventions, allowing for adaptive policy adjustments based on real-time evidence and stakeholder feedback.\u003c/p\u003e \u003cp\u003eThis study has several limitations that suggest avenues for future research. The results may not generalize beyond the 16 emerging economies analyzed. Additionally, other potential moderators\u0026mdash;such as education, finance, or environmental regulation\u0026mdash;were omitted. The study's aggregate-level, quantitative approach limits insights into sectoral, informal, or micro-level entrepreneurial dynamics. Future studies should explore these aspects using mixed methods and broader samples. Investigating how the effects evolve over time or in response to external shocks (e.g., pandemics or climate crises) would also provide valuable insights. Addressing these gaps can improve policy design and enhance the role of entrepreneurship in sustainable development.\u003c/p\u003e"},{"header":"Declarations","content":"\u003cp\u003e \u003ch2\u003eEthics Statement\u003c/h2\u003e \u003cp\u003eThis article does not contain any studies with human participants performed by any of the authors.\u003c/p\u003e \u003c/p\u003e\u003ch2\u003eFunding:\u003c/h2\u003e \u003cp\u003eThis research received no external funding.\u003c/p\u003e\u003ch2\u003eAuthor Contribution\u003c/h2\u003e\u003cp\u003eFaisal Alfehaid: Conceptualization, Formal analysis, Methodology, Writing \u0026ndash; original draft, Visualization, and Investigation.Anis Omri (Corresponding Author): Conceptualization, Data curation, Formal analysis, Supervision, Validation, Writing \u0026ndash; review \u0026amp; editing.\u003c/p\u003e\u003ch2\u003eData Availability\u003c/h2\u003e\u003cp\u003eThe research data supporting this article are available from the authors upon reasonable request.\u003c/p\u003e"},{"header":"References","content":"\u003col\u003e\u003cli\u003e\u003cspan\u003eAbegaz MB, Debela KL, Hundie RM (2023) The effect of governance on entrepreneurship: from all income economies perspective. J Innov Entrepreneurship 12(1):1\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eAcs ZJ, Desai S, Hessels J (2008) Entrepreneurship, economic development and institutions. Small Bus Econ 31(3):219\u0026ndash;234\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eAidis R, Estrin S, Mickiewicz T (2008) Institutions and entrepreneurship development in Russia: A comparative perspective. J Bus Ventur 23(6):656\u0026ndash;672\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eAlfehaid F, Omri A, Altwaijri A (2024) Impact of ICT diffusion and opportunity entrepreneurship on environmental sustainability in Saudi Arabia. \u003cem\u003eHeliyon\u003c/em\u003e, \u003cem\u003e10\u003c/em\u003e(19)\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eAltwaijri A, Omri A, Alfehaid F (2024) Promoting entrepreneurship for sustainable development: Are education capital and ICT diffusion important? Sustain Dev 32(5):5463\u0026ndash;5487\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eAudretsch DB, Keilbach M (2004) Entrepreneurship and regional growth: An evolutionary interpretation. J Evol Econ 14(5):605\u0026ndash;616\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eAutio E, Koml\u0026oacute;si \u0026Eacute;, Szerb L, Galambosn\u0026eacute; Tiszberger M, Park D, Jinjarak Y (2024) Digital entrepreneurship landscapes in developing Asia: insights from the Global Index of Digital Entrepreneurship Systems. Eur J Innov Manage\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eBarney J (1991) Firm resources and sustained competitive advantage. J Manag 17(1):99\u0026ndash;120. \u003cspan class=\"ExternalRef\"\u003e\u003cspan class=\"RefSource\"\u003ehttps://doi.org/10.1177/014920639101700108\u003c/span\u003e\u003cspan address=\"10.1177/014920639101700108\" targettype=\"DOI\" class=\"RefTarget\"\u003e\u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eBelz FM, Binder JK (2017) Sustainable entrepreneurship: A convergent process model. Bus Strategy Environ 26(1):1\u0026ndash;17\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eBharadwaj AS (2000) A resource-based perspective on information technology capability and firm performance: An empirical investigation. MIS Q 24(1):169\u0026ndash;196. \u003cspan class=\"ExternalRef\"\u003e\u003cspan class=\"RefSource\"\u003ehttps://doi.org/10.2307/3250983\u003c/span\u003e\u003cspan address=\"10.2307/3250983\" targettype=\"DOI\" class=\"RefTarget\"\u003e\u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eBowen R, Morris W (2019) The digital divide: Implications for agribusiness and entrepreneurship. Lessons from Wales. J Rural Stud 72:75\u0026ndash;84\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eCarroll JJ (2017) Failure is an option: the entrepreneurial governance framework. J Entrepreneurship Public Policy 6(1):108\u0026ndash;126\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eCervell\u0026oacute;-Royo R, Devece C, Lull JJ (2024) Analysis of economic growth through the context conditions that allow entrepreneurship. RMS, 1\u0026ndash;23\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eCoase RH (1937) The nature of the firm. Economica 4(16):386\u0026ndash;405. \u003cspan class=\"ExternalRef\"\u003e\u003cspan class=\"RefSource\"\u003ehttps://doi.org/10.2307/2626876\u003c/span\u003e\u003cspan address=\"10.2307/2626876\" targettype=\"DOI\" class=\"RefTarget\"\u003e\u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eDean TJ, McMullen JS (2007) Toward a theory of sustainable entrepreneurship: Reducing environmental degradation through entrepreneurial action. J Bus Ventur 22(1):50\u0026ndash;76\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eElmonshid LBE, Sayed OA (2024) The Relationship between Entrepreneurship and Sustainable Development in Saudi Arabia: A Comprehensive Perspective. Economies 12(8):198\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eEstrin S, Korosteleva J, Mickiewicz T (2013) Which institutions encourage entrepreneurial growth aspirations? J Bus Ventur 28(4):564\u0026ndash;580\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eGomes S, Lopes JM (2022) ICT access and entrepreneurship in the open innovation dynamic context: Evidence from OECD countries. J Open Innovation: Technol Market Complex 8(2):102\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eGrandori A (2024) Entrepreneurial governance and the nature of the entrepreneurial firm. Small Bus Econ 63(4):1503\u0026ndash;1516\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eHeritage Foundation (2022) \u003cem\u003eIndex of Economic Freedom\u003c/em\u003e. \u003cspan class=\"ExternalRef\"\u003e\u003cspan class=\"RefSource\"\u003ehttps://www.heritage.org/index/\u003c/span\u003e\u003cspan address=\"https://www.heritage.org/index/\" targettype=\"URL\" class=\"RefTarget\"\u003e\u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eHussain H, Jun W, Radulescu M (2024) Innovation performance in the digital divide context: Nexus of digital infrastructure, digital innovation, and e-knowledge. J Knowl Econ 16:3772\u0026ndash;3792\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eKhyareh MM, Zamani M (2022) Economic Freedom, Entrepreneurship And Economic Growth: Evidence From Panel Data. J Dev Entrepreneurship 27(04):2250027\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eLewis WA (2013) Theory of economic growth. Routledge\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eLi X, Yang G, Shao T, Yang D, Liu Z (2024) Does digital infrastructure promote individual entrepreneurship? Evidence from a quasi-natural experiment on the Broadband China strategy. Technol Forecast Soc Chang 206:123555\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eMagd H, Khan SA, Nte ND, Sarim M (2023) Entrepreneurship and economic sustainability. 1: Prestige Publishers, New Delhi, IndiaEditor: Hesham Magd, Edition\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eM\u0026eacute;ndez-Picazo MT, Galindo-Mart\u0026iacute;n M\u0026Aacute;, Ribeiro-Soriano D (2012) Governance, entrepreneurship and economic growth. Entrepreneurship Reg Dev 24(9\u0026ndash;10):865\u0026ndash;877\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eNeumann T (2021) The impact of entrepreneurship on economic, social and environmental welfare and its determinants: a systematic review. Manage Rev Q 71(3):553\u0026ndash;584\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eNorth DC (1990) Institutions, institutional change and economic performance. Cambridge University Press\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eOlsson AR, Westlund H, Larsson JP (2020) Entrepreneurial governance and local growth. Sustainability 12(9):3857\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eOrde\u0026ntilde;ana X, Vera-Gilces P, Zambrano-Vera J, Jim\u0026eacute;nez A (2024) The effect of high-growth and innovative entrepreneurship on economic growth. J Bus Res 171:114243\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003ePoschke M (2013) Entrepreneurs out of necessity: A snapshot. Appl Econ Lett 20(7):658\u0026ndash;663\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eRaimi L (2024) The Role of Entrepreneurship as Catalysts for Sustainability and a Green, Resilient Economy. Emerald Publishing\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eRaimi L, Haini H (2024) Impact of entrepreneurial governance and ease of doing business on economic growth: Evidence from ECOWAS economies. J Public Affairs, 24(1), e2887\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eReynolds P, Bosma N, Autio E, Hunt S, De Bono N, Servais I, Chin N (2005) Global entrepreneurship monitor: Data collection design and implementation 1998\u0026ndash;2003. Small Bus Econ 24(3):205\u0026ndash;231\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eSchade P, Schuhmacher MC (2022) Digital infrastructure and entrepreneurial action-formation: A multilevel study. J Bus Ventur 37(5):106232\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eSchumpeter JA (1934) \u003cem\u003eThe Theory of Economic Development\u003c/em\u003e\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eScott WR (1995) Institutions and organizations. Sage, Thousand Oaks, CA\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eScott WR (2001) Institutions and organizations: Ideas, interests, and identities, 2nd edn. Sage, Thousand Oaks, CA\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eToma SG, Grigore AM, Marinescu P (2014) Economic development and entrepreneurship. Procedia Econ finance 8:436\u0026ndash;443\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eUnited Nations (2020) E-Government Survey 2020: Digital Government in the Decade of Action for Sustainable Development. Department of Economic and Social Affairs\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003evan Stel A, Carree M, Thurik R (2005) The effect of entrepreneurial activity on national economic growth. Small Bus Econ 24(3):311\u0026ndash;321\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eWang S, Song Y, Du AM, Liang J (2024) The digital economy and entrepreneurial dynamics: An empirical analysis of urban regions in China. Res Int Bus Finance 71:102459\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eWei B, Zhao C, Cai W, Chen B, Lu Y (2024) The entrepreneurial effect of digital infrastructure development: micro evidence from China. Inform Technol Dev 31(3):1\u0026ndash;31\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eWernerfelt B (1984) A resource-based view of the firm. Strateg Manag J 5(2):171\u0026ndash;180. \u003cspan class=\"ExternalRef\"\u003e\u003cspan class=\"RefSource\"\u003ehttps://doi.org/10.1002/smj.4250050207\u003c/span\u003e\u003cspan address=\"10.1002/smj.4250050207\" targettype=\"DOI\" class=\"RefTarget\"\u003e\u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eWilliamson OE (1981) The economics of organization: The transaction cost approach. Am J Sociol 87(3):548\u0026ndash;577. \u003cspan class=\"ExternalRef\"\u003e\u003cspan class=\"RefSource\"\u003ehttps://doi.org/10.1086/227496\u003c/span\u003e\u003cspan address=\"10.1086/227496\" targettype=\"DOI\" class=\"RefTarget\"\u003e\u003c/span\u003e\u003c/span\u003e\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eWu W, Wang S, Jiang X, Zhou J (2023) Regional digital infrastructure, enterprise digital transformation and entrepreneurial orientation: Empirical evidence based on the broadband China strategy. Inf Process Manag 60(5):103419\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eXiong C, Liang Y, Zhang B (2024) Digital infrastructure and urban entrepreneurship level. Appl Econ Lett, 1\u0026ndash;8\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eXu A, Li P, Xin X (2024) The Impact of Digital Governance on Entrepreneurial Activity in Relatively Poor Areas: Evidence from Tibet, China. Sustainability 16(17):7247\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eYin Z, Gong X, Guo P, Wu T (2019) What drives entrepreneurship in digital economy? Evidence from China. Econ Model 82:66\u0026ndash;73\u003c/span\u003e\u003c/li\u003e \u003cli\u003e\u003cspan\u003eYusuf N, Albanawi NI (2016) The role of entrepreneurship in economic development in Saudi Arabia. Bus Econ J 7:1\u0026ndash;5\u003c/span\u003e\u003c/li\u003e\u003c/ol\u003e"}],"fulltextSource":"","fullText":"","funders":[],"hasAdminPriorityOnWorkflow":false,"hasManuscriptDocX":true,"hasOptedInToPreprint":true,"hasPassedJournalQc":"","hasAnyPriority":false,"hideJournal":true,"highlight":"","institution":"","isAcceptedByJournal":false,"isAuthorSuppliedPdf":false,"isDeskRejected":"","isHiddenFromSearch":false,"isInQc":false,"isInWorkflow":false,"isPdf":false,"isPdfUpToDate":true,"isWithdrawnOrRetracted":false,"journal":{"display":true,"email":"[email protected]","identity":"researchsquare","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":true,"externalIdentity":"","sideBox":"","snPcode":"","submissionUrl":"/submission","title":"Research Square","twitterHandle":"researchsquare","acdcEnabled":true,"dfaEnabled":false,"editorialSystem":"","reportingPortfolio":"","inReviewEnabled":false,"inReviewRevisionsEnabled":true},"keywords":"Entrepreneurship, Economic sustainability, Digitalization, Entrepreneurial governance","lastPublishedDoi":"10.21203/rs.3.rs-7796316/v1","lastPublishedDoiUrl":"https://doi.org/10.21203/rs.3.rs-7796316/v1","license":{"name":"CC BY 4.0","url":"https://creativecommons.org/licenses/by/4.0/"},"manuscriptAbstract":"\u003cp\u003eThis study examines the role of entrepreneurship in promoting economic sustainability in emerging economies, with a particular focus on the moderating effects of digital infrastructure and entrepreneurial governance. Drawing on panel data from 17 emerging countries over the period 2002\u0026ndash;2021, the analysis distinguishes between opportunity-driven, necessity-driven, and total early-stage entrepreneurial activity (TEA) to assess their individual and combined effects on economic sustainability. The study employs robust econometric techniques, including the Augmented Mean Group (AMG) estimator, and examines interaction effects through moderation analysis. Findings indicate that opportunity entrepreneurship significantly enhances economic sustainability, while necessity-driven entrepreneurship exerts a negative effect. TEA shows no significant direct impact. However, the inclusion of moderating variables alters these relationships: digital infrastructure and entrepreneurial governance reinforce the positive influence of opportunity entrepreneurship, rendering the TEA impact statistically significant. Notably, only entrepreneurial governance successfully moderates the adverse effect of necessity entrepreneurship. These results underscore the importance of institutional and technological enablers in translating entrepreneurial efforts into sustainable outcomes. The study presents key policy implications, advocating for strategic investments in digital ecosystems and reforms to governance frameworks to cultivate inclusive and innovation-driven entrepreneurship.\u003c/p\u003e","manuscriptTitle":"Empowering Sustainable Entrepreneurship: How Governance and Digital Infrastructure Reframe Entrepreneurial Outcomes?","msid":"","msnumber":"","nonDraftVersions":[{"code":1,"date":"2025-12-16 10:37:34","doi":"10.21203/rs.3.rs-7796316/v1","editorialEvents":[{"type":"communityComments","content":0}],"status":"published","journal":{"display":true,"email":"[email protected]","identity":"researchsquare","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":true,"externalIdentity":"","sideBox":"","snPcode":"","submissionUrl":"/submission","title":"Research Square","twitterHandle":"researchsquare","acdcEnabled":true,"dfaEnabled":false,"editorialSystem":"","reportingPortfolio":"","inReviewEnabled":false,"inReviewRevisionsEnabled":true}}],"origin":"","ownerIdentity":"df875547-67f8-4fc0-b26e-cada4136ae13","owner":[],"postedDate":"December 16th, 2025","published":true,"recentEditorialEvents":[],"rejectedJournal":[],"revision":"","amendment":"","status":"posted","subjectAreas":[{"id":59608540,"name":"Business and commerce/Business and management"},{"id":59608541,"name":"Social science/Business and management"},{"id":59608542,"name":"Business and commerce/Economics"},{"id":59608543,"name":"Social science/Economics"},{"id":59608544,"name":"Business and commerce/Information systems and information technology"}],"tags":[],"updatedAt":"2026-01-07T09:08:40+00:00","versionOfRecord":[],"versionCreatedAt":"2025-12-16 10:37:34","video":"","vorDoi":"","vorDoiUrl":"","workflowStages":[]},"version":"v1","identity":"rs-7796316","journalConfig":"researchsquare"},"__N_SSP":true},"page":"/article/[identity]/[[...version]]","query":{"redirect":"/article/rs-7796316","identity":"rs-7796316","version":["v1"]},"buildId":"8U1c8b4HqxoKbykW_rLl7","isFallback":false,"isExperimentalCompile":false,"dynamicIds":[84888],"gssp":true,"scriptLoader":[]}