Entrepreneurial dynamism and public policy actions for sustainable development in Nigeria

This study investigates the impact of public policy on entrepreneurial dynamism and its consequent effect on sustainable development in Nigeria. International development institutions such as the World Bank and United Nations agencies underscore the importance of a robust entrepreneurial ecosystem for employment generation, innovation, poverty reduction, improved living standards, and economic growth. Despite increased policy attention and financial support, business enterprises in Nigeria continue to emerge, decline, or undergo transformation—a process referred to as entrepreneurial dynamism. This phenomenon is shaped by public policy and other contextual factors, and it exerts varying effects on the entrepreneurial ecosystem. Employing the Autoregressive Distributed Lag (ARDL) bounds testing approach and time series data spanning 2000 to 2023, the study examines the influence of selected public policy variables—taxation, human capital, lending interest rate, government effectiveness, and broad money supply—on entrepreneurial dynamism, and how these interactions affect sustainable development. Findings reveal a positive and significant relationship between broad money supply (M2) and entrepreneurial dynamism (ENTD), indicating that expansionary monetary policies enhance entrepreneurial activities. In contrast, a negative and significant association is observed between lending interest rate (INTrL) and ENTD, suggesting that high borrowing costs discourage entrepreneurship. Furthermore, entrepreneurship (ENTr) demonstrates a strong and positive impact on sustainable development (SD), underscoring its critical role in national development. The paper recommends that policymakers integrate entrepreneurship considerations into the design and implementation of public policies to foster a dynamic entrepreneurial ecosystem capable of advancing sustainable development goals.