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Introduction
In the history of development economics, the availability of natural resources such as oil and gas, copper and gold has been thought of as key drivers in economic growth (Schwab and Sala-i-Martín, 2013). In this realm, over several decades, Gulf Cooperation Council (GCC) countries that are driven by non-renewable resources, mainly oil and gas, have experienced a rapid increase in economic growth (i.e. GDP per capita) and standards of living due to the high demand on mineral resources (Callen et al. , 2014). However, these countries risk lower levels of productivity in other economic activities such as manufacturing and services industries, because of overreliance on non-renewable resources. Moreover, these countries will be more susceptible to variations in oil and gas prices in the global market (i.e. the Dutch disease) (Sachs and Warner, 1995; Schwab and Sala-i-Martín, 2013). Therefore, the abundance of natural resources may not necessarily be directly associated with economic growth that lead for sustainable development (Al-Roubaie, 2013).
The GCC countries have made several attempts to diversify their economies towards a more sustainable model. However, their efforts have not proven effective across the board (Callen et al. , 2014). Recently, Qatar, Bahrain and UAE are among GCC countries that have managed to move forward in the stages of economic development to reach the innovation-driven stage (knowledge-based economy) by depending less on oil revenues and focusing more on export diversification (Schwab and Sala-i-Martín, 2016).
There is a growing body of literature that has recognised the importance of entrepreneurship in economic growth and development (Acs and Szerb, 2010; Acs et al. , 2014b). In line with efforts to move towards a more developed and sustainable economic model, the GCC countries have vested much time and emphasis on entrepreneurship in recent years (Al-Obaidy, 2012; Al-Roubaie, 2013; Callen et al. , 2014). In the same realm, there has been renewed interest in institutional economics to provide a better understanding for entrepreneurship research (Bruton et al. , 2010), which is of particular importance to GCC countries in moving towards a more sustainable economic development. The preliminary evidence suggested that institutional environment is among the most important factors for the variations of entrepreneurship activity in different stages of economic development (Busenitz et al. , 2000; Acs et al....