An Investigation into the Interrelationship Between Institutions and Entrepreneurship

Institutions and their related organizations strongly influence the speed and direction ofeconomic growth. Consequently, they are regarded as a major factor for growth. Entrepreneurshipis also known to be an important driving force for economic growth. Withthis regard, any action to direct and strengthen productive activities is an important consideration.Hence, it is important to devise effective instruments to influence the entrepreneurialactivities in a productive way. Institutions, entrepreneurship and their interrelationshiphave a considerable influence on economic growth. This work is concernedwith the relationship between institutions and entrepreneurship and the way in whichthey interact. To this end, this study employs established methods and presents a frameworkto determine the way in which they influence each other. Furthermore, the experienceof other countries is used to propose a strategy for Iran in relation to institutions andentrepreneurship. The investigation uses empirical data to determine the coefficients requiredin the proposed model. The output of the proposed model shows that there is apositive relationship between entrepreneurship and the strength of institutions.