When the going gets tough, who gets going? Relational embeddedness, institutional support and entrepreneurial continuance: evidence from China's small business owners

Purpose This study investigates how relational embeddedness and perceived institutional support influence entrepreneurs' intention to keep entrepreneurial ventures going in an emerging transition economy, China, during a major disruption, such as the COVID-19 pandemic. Design/methodology/approach We surveyed 295 small business owners in China during its second COVID-19 wave. Covariance-based Structural Equation Modelling (CB-SEM) was used to evaluate the model. Findings The study found that relational embeddedness and perceived institutional support both significantly influenced their intention for entrepreneurial continuance (IEC) through the mediating effects of the three Theory of Planned Behaviour (TPB) determinants. It also found that relational embeddedness—characterised by relational closeness and trust—significantly influenced entrepreneurs' IEC, mediated through the TPB constructs. In addition, institutional support functioned as a key antecedent to the TPB constructs and helped shape entrepreneurs' crisis-driven continuance intentions. Finally, it found a non-significant correlation between subjective norms and IEC, and that Recovery Prospect (RP) did not moderate the relationships between the three TPB predictors and IEC. Research limitations/implications This research is limited by its cross-sectional nature. It is also confined to one country, China, and may lack generalisability in other countries and contexts. Originality/value The research enhances the understanding of entrepreneurial ecosystems and resilience in entrepreneurship by identifying the factors influencing entrepreneurs' decisions to sustain their ventures during significant disruptions. It reinforces the explanatory capacity of the Theory of Planned Behaviour (TPB) in predicting Intentional Entrepreneurial Continuance (IEC). It also reinforces the roles of social capital through relational embeddedness and institutional support in facilitating small business survival. Moreover, the significant impact of internal migrant status on continuance intention, as well as other constructs in this study, echoes previous research that finds internal migrant entrepreneurs generally face greater entrepreneurial barriers.