THE NEXUS OF FINANCIAL DEVELOPMENT, TECHNOLOGICAL INNOVATION, ECONOMIC GROWTH AND ENTREPRENEURSHIP: THE MODERATING ROLE OF GOVERNMENT SUPPORT IN BRICS COUNTRIES
DOI:
https://doi.org/10.18623/rvd.v23.5442Palavras-chave:
Entrepreneurship, Financial Development, Technological Innovation, Economic Growth, Government Support, BRICS EconomiesResumo
Entrepreneurship has been greatly acknowledged as an imperative source of innovation, productivity, and long-term economic growth. Nevertheless, the processes that determine how financial growth, technological innovation, and macroeconomic situation can affect entrepreneurial activity are still theoretically complicated and empirically inhomogeneous among the emerging economies. This paper examines the nexus of financial development, technological innovation, economic growth and entrepreneurship among the BRICS economies (Brazil, Russia, India, China and South Africa) between the years 2001 and 2023 and the moderating factor of government support. The study is based on second-generation panel econometric models that consider cross-sectional dependence and country heterogeneity through the use of a macro-panel dataset built out of the internationally-recognized publications, such as the Global Entrepreneurship Monitor (GEM), World Development Indicators (WDI), and Worldwide Governance Indicators (WGI). In particular, Cross-Sectionally Augmented Autoregressive Distributed Lag (CS-ARDL) model is used to determine both the short-run and long-term associations between the variables. According to the empirical evidence, financial development is a leading factor that encourages entrepreneurial activities through ease of access and limitation of credit available to new enterprises. Another positive impact that economic growth has on entrepreneurship is the creation of market opportunities and the reinforcement of the general business environment. Contrastingly, the direct impact of technological innovation on entrepreneurship does not show a notable impact when viewed separately. Nonetheless, the findings indicate that government support has a strong role of moderation, which enhances the association between technological innovation and entrepreneurial activity. Such results imply that innovation-oriented entrepreneurship does not just rely on the technological capacity, but also the existence of conducive institutional systems and proper governance mechanisms. The research paper adds value to the literature on entrepreneurship and development in that, it provides emphasis on integrated policy frameworks that would simultaneously enhance financial development, ecosystem of innovation as well as the institutional quality in the effort of supporting the growth of entrepreneurship in emerging economies.
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