Institutions and dynamic capabilities: Theoretical insights and research agenda for strategic entrepreneurship

The current paper aims to comparatively analyze both institutional and dynamic capabilities approaches conceptually in the context of strategic entrepreneurship. We offer a conceptual review, where strengths, as well as limitations of both theoretical approaches, are highlighted. Our review and discussion show that both approaches are subtly intertwined and can complement each other to further understanding of firm behavior. Institutions provide structural templates for action and cognition in developing, managing, and utilizing dynamic capabilities. Dynamic capabilities, as enablers of agency, can be expected to play a role in creating, maintaining, bridging, and disrupting institutions. Accordingly, the synthesis of institutional and dynamic capabilities approaches leads to a better understanding of agency, behavior, and structure in the context of strategic entrepreneurship for which we present a research agenda that explores key concepts germane to both institutions and dynamic capabilities.