Exploring the Impact of Sustainable Economic Growth and Financial Development to Instigate Entrepreneurial Activities for Global Sustainability

Abstract

Entrepreneurship stands out in the diverse range of human pursuits, characterized by bold aspirations, steadfast determination, and a transformative mindset. This is the place where hurdles are transformed into bridges, uncertainties drive invention, and fear is replaced by bold jumps. Entrepreneurs use transmutation to convert ordinary things into extraordinary ones, creating paths to growth and sparking positive impact for everyone. This study aims to find the impact of economic growth, trade openness, and human capital on entrepreneurial activities. The study uses Ordinary Least Square (OLS), Fixed Effects (FE), and Generalized Methods of Movement (GMM) estimation techniques to the annual unbalanced panel data of 217 countries from 1999 to 2022. The findings of this study show that economic growth instigate entrepreneurial activities. The GMM results from the table of baseline results show that one-unit change in economic growth brings 0.030 units positive and significant change in new business density which indicates that higher economic growth rate is connected with a higher rate of entrepreneurial activities. It demonstrates that the level of entrepreneurial activities in different economies around the world grows as the economic growth of those economies increases. On the other hand, the results of GMM show that the one-unit change in interaction terms of financial development with economic growth show 0.332 units positive and significant change entrepreneurial activities. These findings indicate that financial development plays an essential moderating role in instigating entrepreneurial activities. The study provides guidance to the individuals, institutions, policymakers, researchers and all the stakeholders who want to take initiatives for business activities.