Human capital, institutions, and ambitious entrepreneurship during good times and two crises

Mircea Epure *, VICTOR MARTIN SANCHEZ, Sebastian Aparicio, David Urbano Pulido

*Corresponding author for this work

Research output: Contribution to journalArticleResearchpeer-review

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Research Summary: We argue that the positive relationship between pro-market institutions and entrepreneurial growth aspirations is dampened for individuals with general human capital (higher education), but augmented for those with specific human capital (experience in the marketplace). However, during a crisis, the differential effect of pro-market institutions on growth aspirations manifests only for entrepreneurs with specific human capital, with stronger effects than in good economic times. We run our empirical analysis on a dataset of individual- and country-level characteristics during 2005–2020, thus exploiting variation from the Global Financial Crisis and the COVID-19 pandemic. We confirm our predictions and show stronger results for early stage (compared to nascent) entrepreneurs, and potential complementarities between human capital types. Altogether, our work paves the way to institutional adaptive policymaking. Managerial Summary: Pro-market institutions facilitate business activity. We analyze a continuum of institutional arrangements and show asymmetric joint effects of the business context and human capital on entrepreneurial growth aspirations. General, education-based human capital can collide with pro-market contexts, weakening their positive effect on growth aspirations. In contrast, the interaction between pro-market contexts and specific, market-based human capital acts as a catalyst of growth aspirations. The (mis)alignment between pro-market institutions and specific human capital from start-up or investment experience gains an increased importance during the Global Financial Crisis and the COVID-19 pandemic. Our findings are stronger for early stage business owners beyond the nascent phase, and complementarities can appear between education and market experience. We discuss policy implications for entrepreneurship education and regional development.

Original languageEnglish
Number of pages34
JournalStrategic Entrepreneurship Journal
Early online dateDec 2023
Publication statusPublished - 14 Dec 2023


  • crisis
  • entrepreneurship
  • growth aspirations
  • human capital
  • pro-market institutions


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