Entrepreneurial Self-Efficacy Based Model of Sme Performance in Developing Countries

Abstract

SME performance has been considered as one of the most important driving force behind economies of both developed and developing countries due to their multiple contributions. In most of the developing countries, the performance of the SMEs is a key issue today. Since the SMEs in developing countries face many obstacles, the human agency is critical for their performance. This study proposes an entrepreneurial self-efficacy based model of SME performance for developing countries. Based on the Social Cognitive theory, the model suggests an interaction among human related factors, entrepreneurial self-efficacy and SME performance. Achievement motivation, personal goal-setting and mastery experience have been incorporated into the model as predictors of performance while it suggests that entrepreneurial self-efficacy plays a significant mediating role between human related factors and SME performance. It contributes for better understanding of complex interactions between human related factors and SME performance in developing countries.