Forces of Dynamic Capability and Incidence of Entrepreneurship: A Macroeconomic Policy Intervention Approach

The dynamic entrepreneurial capabilities refer to sensing, seizing, and transforming new business opportunities. The contributions that entrepreneurial activities can bring to economies that have well documented include ideation, resource mobilization, and efficiency are key attributes promoting entrepreneurship. This study proposes a dynamic capabilities framework that could help explain how individuals could transform themselves by getting support from the environmental factors towards new venture creation. Previous studies have used the conventional model of using socio-economic factors in explaining entrepreneurship, which lacks detail regarding the holistic process of becoming an entrepreneur. This paper uses a dynamic capabilities model to examine how individuals transform themselves into successful entrepreneurs. A new conceptual framework is developed using the GEM database. Using the sensing and seizing pillars of the dynamic capabilities theory as the transformational dimensions towards entrepreneurship. The pillars are developed using factor analysis. In the second stage of the analysis, the effects of pillars on entrepreneurship are assessed for different quantile levels. The results revealed that sensing and seizing transformation dimensions are instrumental in motivating entrepreneurial intentions from the policy perspective.