Digital Entrepreneurship in Developing Economies: Opportunities and Constraints

Abstract

Digital entrepreneurship has become a dynamic phenomenon that provides alternatives for innovation, job creation and inclusive economic development in developing economies. Nowadays, as technology, such as the Internet, mobile phones, digital payment systems and e-commerce have become so prevalent, it is much easier for an entrepreneur to launch and develop a business than it is for a person to launch and develop a traditional business. Despite these opportunities, digitally based entrepreneurs in developing countries still are confronted with substantial structural and institutional barriers which limit their sustainable growth in the business. The purpose of this study is to examine the main opportunities and the main challenges of digital entrepreneurship in developing economies, and to integrate the results of the literature, the policy reports and the empirical research. The research identifies a number of important opportunities such as Women and Youth entrepreneurial activities, digital innovation, cross border trade, financial inclusion through fintech solutions and market access. At the same time, it also identifies key challenges, including lack of digital infrastructure, limited access to financial resources, low digital literacy, cyber risks, regulatory risks and differential internet penetration across the rural and urban areas. The study method is qualitative review to examine the interrelationships of technological readiness, entrepreneurial ecosystems and public policy frameworks. The results indicate that the success of digital entrepreneurship requires joint actions by governments, financial institutions, educational institutions and technology companies to build up digital infrastructure, expand entrepreneurial skills and create supportive environment for entrepreneurs. The paper concludes that digital entrepreneurship has substantial potential to speed up the sustainable economic development and social inclusion process in developing economies, but this potential can only be realized if the persistent institutional and technological barriers can be overcome, in the longer-term. The study offers practical lessons for policy makers, academic and research institutes, educators, and entrepreneurs in designing resilient and innovation-driven entrepreneurial ecosystems in emerging markets.