Analysing The Effect of Institutional Environment on the Rural-Based Women Entrepreneurs Firm Performance Through Entrepreneurial Orientation

Abstract

The current body of research has often generalised the small and medium enterprise performance and largely ignored the unique challenges faced within women entrepreneurs (WEs) context. Similarly, studies on WEs have mostly overlooked the geographical and cultural disparities that are assumed to significantly impact the profitability of the firms. Hence, the current study aims to analyse the impact of institutional environmental (IE) on the women-led SMEs performance in rural region (north-eastern) of India. Furthermore, considering the unique cultural and environmental factors in rural areas the study also analyse the mediating role of entrepreneurial orientation (EO) between IE and women-led SME performance. The research used a sample of 344 WEs which are actively operating in rural areas. The findings were derived by the use of partial least squares structural equation modelling. The findings show that regulative and cognitive sub-dimensions of IE positively affect the SME performance. Furthermore, the results indicate an insignificant impact of normative sub-dimension. The mediating analysis show that entrepreneurial orientation partially mediates between regulative, cognitive sub-dimensions and SME performance. In contrast, EO fully mediates between normative sub-dimension and performance.