HOW DOES THE BUSINESS ENVIRONMENT EMPOWER ENTREPRENEURSHIP? ——EVIDENCE FROM CHINESE PREFECTURE-LEVEL CITIES

Optimizing the business environment and promoting entrepreneurship vigorously are crucial measures to implement the innovation-driven strategy, stimulate the vitality of market entities, and achieve high-quality economic development. Using a sample of entrepreneurship cultivation across 280 prefecture-level cities in China, based on the perspectives of the New Institutional Economics school and the Complex Systems view, and employing configurational thinking, this study employs fuzzy set qualitative comparative analysis (fsQCA) to investigate the multifaceted concurrent factors influencing entrepreneurship and the complex pathways for its cultivation. The study reveals the following findings: (1) None of the seven constituent elements within the business environment independently constitutes a necessary condition for high entrepreneurship, yet high levels of public services, financial services, and innovation environment universally contribute to fostering entrepreneurship. (2) There are three pathways to achieving high entrepreneurship: administration-assisted innovation-driven, market-driven supported by resources, and input-driven innovation-driven. (3) In cases where urban areas lack key elements or exhibit poor performance across all conditions, the cultivation and stimulation of entrepreneurship are hindered. This research enriches the understanding of antecedents influencing the formation of entrepreneurship and provides practical insights for optimizing the business environment to foster entrepreneurship.