ENTREPRENEURIAL LAW AND INNOVATION: EXPLORING LEGAL BARRIERS AND ENABLERS FOR STARTUPS IN DEVELOPING NATIONS

Abstract

Entrepreneurial law plays a crucial role in shaping innovation and startup development, especially within developing nations where structural, institutional, and legal challenges often hinder business growth. This paper examines the intricate relationship between law, entrepreneurship, and innovation, emphasizing how outdated regulations, weak enforcement, and bureaucratic inefficiencies impede entrepreneurial activity. It explores the concept of entrepreneurial law as a multidisciplinary framework encompassing corporate, labor, intellectual property, tax, and competition laws that govern the startup lifecycle. The analysis identifies key legal barriers, including complex regulations, inadequate contract enforcement, weak IP protection, restrictive labor and tax policies, and pervasive corruption. These factors collectively create uncertainty and discourage innovation-driven entrepreneurship. Conversely, the paper highlights potential legal enablers that can foster innovation—such as streamlined regulatory processes, strong IP protection, transparent governance, and adaptive legal reforms that encourage experimentation. Ultimately, the study concludes that consistent, open, and responsive legal systems are essential for transforming developing economies from factor-driven to innovation-driven models, thereby promoting sustainable entrepreneurial ecosystems and inclusive economic growth.