Institutional quality and technological innovations: Transforming entrepreneurship in South Asia

This study examines the impact of institutional quality and technological innovations on entrepreneurship development in the South Asian region. Using data from 2010 to 2024 for all South Asian countries except Afghanistan, we investigate the relationship between entrepreneurship development as dependent variable and technological innovation and institutional quality as independent variables. We have also considered foreign direct investment, financial development, and economic growth as control variables. Applying the Two-step system generalized method of moments, it is observed that technological innovation, institutional quality, and economic growth have a positive and significant impact on entrepreneurship development whereas foreign direct investment and financial development have a positive but insignificant impact. It is further observed that the interaction between institutional quality and technological innovation significantly influences entrepreneurship development. This study provides appropriate policy recommendations for the government, regulatory authorities, institutions, and other relevant stakeholders to strengthen the entrepreneurship ecosystem in South Asia in the future.