Governmental support, innovation, and passion: drivers of entrepreneurial market performance in tourism and hospitality

Abstract

Purpose Entrepreneurial market performance (EMP) in tourism and hospitality is highly vulnerable. This study aims to fill a gap in the literature by examining the impact of governmental non-monetary support (GNMS) – such as consultation, information and human resource support – on EMP in small businesses in two sectors of the hospitality industry, particularly considering how marketing innovation (MI) and service/product innovation (S/PI) mediate this relationship, with entrepreneurial passion (EP) moderating the effect. Design/methodology/approach The theoretical foundation of this study was based on the dynamic capabilities theory (DCT) and interpretive structural modelling (ISM) framework. The research employed a sequential explanatory mixed-methods design, commencing with a survey of 451 owners and managers analysed using partial least squares structural equation modelling (PLS-SEM) to examine the interactions among key factors. This was subsequently followed by a focus group of five officials analysed through ISM to determine the main streams of GNMS. Findings The study fills a research gap by showing how government non-monetary services enhance market performance in small tourism and hospitality businesses. Also, the results from the moderating effect analysis indicated that entrepreneurial passion (EP) served as a moderator in the relationship between GNMS, marketing innovation (MI) and service/product innovation (S/PI) on entrepreneurs’ performance. Practical implications Entrepreneurs may focus on innovating their marketing strategies and improving their service/product offerings while actively pursuing governmental non-monetary support and boosting their entrepreneurial passion. Egyptian policymakers could focus on optimizing non-monetary support for entrepreneurs. Originality/value This study advances DCT theory and ISM framework by emphasizing the critical role of entrepreneurial access to government support in consultation, information and human resource domains.