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

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.