Entrepreneurial self-efficacy and adaptation to change of micro, small and medium enterprise owners: The mediating role of innovation capability

Abstract

This study established the relationship of entrepreneurial self-efficacy and adaptation to change of micro, small and medium enterprises (MSMEs) in Davao City, Philippines and the mediating role of their innovation capability. The study utilized a descriptive-causal quantitative research design involving 542 MSME owners. The test of mediating effect via regression analysis, medgraph, and Sobel z test were used to analyze the data. Results revealed that MSME owners exhibited a very high level of entrepreneurial self-efficacy, a high level of adaptation to change, and a very high level of innovation capability. Zero-ordered correlation revealed positive, significant relationships among the three variables. Regression analysis revealed a significant direct effect of entrepreneurial self-efficacy on adaptation to change and innovation capability, while innovation capability had a significant direct effect on adaptation to change. Lastly, innovation capability partially mediated the relationship of entrepreneurial self-efficacy and adaptation to change of micro, small and medium enterprises. Implications are discussed.