Linking Entrepreneurial Orientation, Learning Orientation, Organization Structure and the Growth of Government

Abstract

The growth of government (GoG) has garnered significant attention among scholars and practitioners across disciplines such as economics, political science, and public management. Despite the optimism surrounding this concept, its future trajectory in the twenty-first century remains uncertain. Extant literature explaining the rationales for organizational growth in the public sector is inconclusive which pertains mostly to the absence of an appropriate methodological approach. Therefore, this research underscores the need for a comprehensive framework to examine the determinants of the growth. Particularly, the burgeoning literature on new public management (NPM) as well as behavioural public administration provides huge potentials to examine the role of the interplay of organizational structure and learning orientation in exacting the impact of entrepreneurial orientation on the growth of government on GoG. The conceptual framework was guided by the hermeneutic approach that focuses on interpreting texts or phenomena by understanding the contextual elements to uncover deeper meaning and insights. It does so by drawing upon different streams of literature including entrepreneurial orientation, learning orientation, organizational structure, and the growth of government. In order to operationalize the framework, a succinct set of propositions is proposed. The proposed conceptual framework along with suggested research propositions will potentially guide future research to further extend the growth of government literature.

1. Introduction

The growth of government (GoG) is considered an important determinant of national-level competitiveness. The GoG is measured using the scope of government activity, which essentially signifies the size of the government (Tarschys 1975; Kau and Rubin 1981). There are two standard measures of the size of the government: the ratio of government expenditure to gross domestic product (GDP) and the number of governmental units or public employment as a percentage of the total workforce (Larkey et al. 1981; Berry and Lowery 1984; Rose 1985; Hughes 2017). Given that governments around the globe are striving to be more entrepreneurial in their operations, the GoG is a crucial factor that determines government effectiveness and potential to compete at the global scale (Quang Dao and Esfahani 1995; Makin and Ratnasiri 2015; Anwar and Shah 2021). To achieve the essence of an entrepreneurial state, a new model—known as new public management (NPM)—has become prominent worldwide. NPM is an umbrella term also known as managerialism or entrepreneurial government and applies business management precepts such as results orientation, strategic planning, service quality, entrepreneurial orientation, desegregation of giant bureaucracies and use of competition (Hood 1991; Farazmand 2017).

Scholars in the field of economics have made important contributions in understanding the determinants of GoG. However, the existing literature relies primarily on country-level panel and time series data (Larkey et al. 1981; Aggarwal 2017). There is a lack of empirical research on the organizational determinants of GoG. The current paper aims to identify the organizational determinants of GoG to better understand the conditions in which GoG occurs. Because governments are becoming increasingly entrepreneurial, various organizational-level constructs have become relevant owing to their effects on GoG. In a highly competitive and unpredictable economic world, governments can be more resilient if they develop the entrepreneurial and learning orientation to achieve GoG (Kattel et al. 2022). For high GoG, other organizational-level changes are instrumental, such as a more flexible and dynamic supporting organizational structure (Altinay and Altinay 2004). Identifying the organizational determinants of GoG will add a timely and relevant contribution to the existing debate on how governments grow and become more competitive (Quang Dao and Esfahani 1995; Makin and Ratnasiri 2015).

The contribution of the current study is two-fold. First, it calls for a balanced approach and asserts that studies on GoG should not primarily be conducted at a country level but should also explore the organizational determinants of GoG in varying contextual settings. Second, it proposes a conceptual framework showing the impact of organizational factors such as entrepreneurial orientation (EO), learning orientation (LO) and organizational structure (OS) on GoG. This proposed conceptual framework, along with the suggested research propositions, serves as a springboard for conducting future empirical research on the organizational determinants of GoG.

The structure of the paper is as follows. The second section elaborates on the method of inquiry used to write a conceptual paper. The third section contains a review of the literature that examines existing models and analyses and explains relevant concepts. The fourth section develops research propositions with supporting literature and presents the conceptual framework. Finally, conclusions are drawn with an indication of future research directions.

2. Methodology

The choice of an appropriate method in academic research is of critical importance. Because the main purpose of this article was to develop a theoretical framework, it is pertinent to examine the diverse aspects of conceptual research. There are several different explanations about what constitutes a good conceptual paper (Weick 1989; Whetten 1989). According to Cropanzano (2009), a theory paper tends to develop a conceptual model and propose new theory at the construct level. In contrast, Gilson and Goldberg (2015) observe that conceptual papers do not propose a new theory at the construct level “but rather they seek to bridge existing theories in interesting ways, link work across disciplines, provide multi-level insights, and broaden the scope of our thinking” (p. 128).

Conceptual papers are distinct from review papers. Review papers create a comprehensive overview of the existing literature in a specific field of study, summarize the findings, and provide a critical appraisal of the future direction of research. Their contribution is derived from these exercises (Short 2009). In conceptual papers, there is also a review of articles, but there is no commonly accepted template. Therefore, reviewers often feel that conceptual papers “offer little more than a descriptive literature review or interesting but disjointed ideas” (Jaakkola 2020, p. 18). However, there are some commonly accepted elements of a conceptual paper, including: (a) choice of appropriate theories, explanation and analysis of concepts, and generation of novel insights; (b) clarification of key concepts; and (c) integration of concepts and high-quality argumentation (Jaakkola 2020). This is similar to hermeneutic approach.

After an extensive review of articles, Jaakkola (2020) identified four types of research design in conceptual papers: theory synthesis, theory adaptation, typology, and model. Of these, the model type was the most appropriate for this current study. The purpose of our model was to develop a theoretical framework that showed the relationships among the identified variables, developed propositions, and explained “why a sequence of events leads to an outcome” (Jaakkola 2020, p. 22).

Before embarking on developing propositions and a theoretical framework, it is important to analyse the existing theories and explain the pertinent concepts. There are various other theories or approaches, such as phenomenology, post-structuralism, and hermeneutic approaches to understand and uncover underlying patterns. Phenomenology explores lived experiences and subjective perspectives, but may not delve deeply into historical or cultural contexts (Moran 2002), which are crucial to understanding the organizational elements in the government context. Also, post-structuralism challenges fixed meanings and hierarchies, but may lead to ambiguity and fragmentation in interpretation (Davey 2014). In comparison, the hermeneutic approach offers a balanced framework that combines historical awareness, cultural sensitivity, and attention to subjective experiences, making it better suited for studies requiring a holistic understanding of complex phenomena with diverse interpretations (Davey 2014). For this purpose, the current study has adopted the hermeneutic approach of research which is similar to other studies in the public and business management domains (Kurnia et al. 2019; Lindgren and Jansson 2013; Boell and Cecez-Kecmanovic 2010; Myers 2015; Llewellyn 1993). The hermeneutic approach depicts an iterative cycle containing specific steps as shown in Figure 1. The hermeneutic analysis includes iterative cycles of interpretation and understanding the meaning of the phenomena of interest (Kurnia et al. 2019).

We followed similar steps, which commenced with searching the relevant literature, taking a multidisciplinary approach, and considering the relevant variables selected for this study. The review of the literature started with searching publications on selected concepts using search engines such as Scopus, Google Scholar, ProQuest and EBSCO. The researchers reviewed the selected publications, which helped refine the search for further publications. Following this, a total of 110 full-text articles were reviewed during the research to understand the linkages among the variables. It was ensured that the leading journals, academic books, and conferences were included in the search. A wide range of keywords were used to search the materials on the identified concepts as represented in

Table 1. Search Terms.

“growth of government” AND “organizational determinants” “growth of government” AND “entrepreneurial orientation” “growth of government” AND “learning orientation” “growth of government” AND “organizational structure” “growth of government” AND “contextual settings” “growth of government” AND “country-level studies” “growth of government” AND “public sector growth” “growth of government” AND “government expansion” “government” AND “growth” AND “entrepreneurship” “government” AND “growth” AND “knowledge-sharing” “government” AND “growth” AND “centralization” “government” AND “growth” AND “formalization” “public sector” AND “expansion” OR “growth” “government” AND “enlargement” “state” AND “growth” “governmental” AND “expansion” AND “entrepreneurship” “government proliferation” AND “structure” “bureaucratic growth” AND “structure”

.

Following the steps as shown in Figure 1, we sorted the literature as per the themes identified. This was followed by the selection of relevant literature, which mainly investigated the study variables and their relationships. Going through the first three stages of the hermeneutic process enabled the researchers to do further research by acquiring more relevant literature. The researchers again went through the literature, identified the gaps, and refined the conceptual boundaries of the study variables. This process was critical to adopt given that the literature on study variables is widely spread and the identified concepts are variously defined.

2.1. An Overview of Existing Literature

In line with the methodological process discussed in the previous section, this section explores the existing theories and their limitations. In addition, the key concepts pertaining to the central theme of the study are explained. The explanation and analysis of the theories and concepts helps to identify the potential relationships between different constructs.

Existing Models and Their Limitations

In the discipline of economics, there is a plethora of literature about the determinants of the GoG (Mueller 1987; Sanz and Velázquez 2007; Obeng and Sakyi 2017; Aktan 2017). Lybeck (1988) identified 12 groups of theories about the determinants of the GoG. It is worth mentioning that many of the theories belong to the public choice school and created the ground for neo-liberal market reforms in the 1980s. Counterarguments have also been advanced to invalidate the arguments of public choice theorists. The fact that the government is inefficient vis-à-vis the market (Krueger 1974) has been demystified by numerous scholarly works (Mazzucato 2011, 2015; Ravenhill 2018; Knafo 2019). The current study considered the determinants as discussed by public choice theorists, but it focused mainly on public entrepreneurship in general and EO in particular as critical factors in explaining the GoG.

Most studies validate the positive impact of EO on organizational performance in the private sector. It is also evident that organizational growth is one of the measures of performance in the context of the private business sector (Wiklund and Shepherd 2005; Kiyabo and Isaga 2020; Wang 2008; Real et al. 2014; Engelen et al. 2015; Kearney and Meynhardt 2016; Rezaei and Ortt 2018). Soomro and Shah (2020) investigated the influence of the mediating role of strategic orientation on the relationship between EO and firm performance. Since the inroads made by the NPM and entrepreneurial government models into public sector management, entrepreneurship as an organizational construct has become popular among practitioners and academics (Bernier and Hafsi 2007; Klein et al. 2010; Kraus et al. 2019; Haque 2020).

Empirical research by Caruana et al. (2002) affirmed the positive impact of EO on the performance of public utilities. In their empirical study, Khan and Bashir (2020) found a positive relationship between EO and organizational performance and a crucial feature of NPM is performance driven by innovation and learning (Kinder 2012). Moon et al. (2020) outlined EO’s five dimensions of innovation, pro-activeness, risk-taking, competitive aggressiveness, and autonomy in public organizations and identified their impact on performance in public service. These dimensions were also found to have influenced the performance of government-linked companies in Malaysia (Koe 2013). Market orientation was the most significant contributor to organizational performance, followed by technology orientation and EO (Masa’deh et al. 2018).

The existing models are inadequate for understanding the GoG in numerous respects. The neoclassical economic models are often self-contradictory and do not provide sufficient insights. Empirical evidence shows that, since the beginning of the neo-liberal market reforms, the increasing trends of public expenditure have remained unscathed (Schuknecht 2020). In the political science and public management literature, GoG remains an understudied phenomenon. In addition, although the entrepreneurship literature in business management has opened new horizons about the diverse aspects of performance, including organizational growth, the study of the GoG remains inadequate. There is a consensus that the private sector differs from the public sector, particularly in public service organizations (Allison 1980). In the business sector literature, the concept of organizational growth is measured in terms of the growth of sales, revenues, business expansion, and so forth. Despite debates, there is a consensus that in the public sector, the size and the number of employees is the essential measures of GoG (Alonso et al. 2015). Existing literature on EO is biased toward the private sector; however, a few studies have addressed the impact of EO on public enterprise performance. Specifically, a knowledge gap exists in understanding GoG in the public service sector domain (Al-Dhaafri et al. 2016; Tremml 2018). Alonso et al. (2015) conducted seminal research on the impact of NPM on the GoG using panel data for the Organization for Economic Cooperation and Development (OECD) countries to ascertain the relationship between NPM (decentralization and outsourcing) and GoG. The findings of their study refuted the claim by the protagonists of the NPM model that pro-market reforms such as decentralization and outsourcing would reduce the size of the public sector. However, the variables that their study selected are not adequate to understand its impact on the GoG.

2.2. Alternative Way of Understanding the Growth of Government

Here, we reflect on an alternative way of understanding the GoG. We argue that while the public choice theorists have had their fair share of contributions, the contemporary literature on radical transformations in the public sector and the entrepreneurial state or public sector entrepreneurship have opened new horizons to glean insights into the organizational determinants of the GoG.

New Public Management, Public Entrepreneurship, Entrepreneurial Orientation and Growth of Government

Since the late 18th century, the role of the state vis-à-vis the market has been an intriguing issue for scholars and policymakers. The role played by the government has drastically changed in the past 150 years from minimal economic participation, handling approximately 10% of the GDP, to handling 40–60% of the GDP (Schuknecht 2020). The Great Deal of the 1930s, the rise of welfare systems, and the developments after World War II reinforced state intervention in the economy and society (Farazmand 2005; Hughes 2017; Schuknecht 2020).

However, since the 1980s, the neo-liberal market ideologues argued that governments were too involved in the economy and consumed too many resources. In addition, public bureaucracy was accused of inefficiency, corruption, and lack of innovation. The neo-liberals came up with a series of recommendations. Along with the reduced role and scope of the public sector, NPM or managerialism replaced the traditional Weberian bureaucracy model. The protagonists of the neo-liberal market ideology succeeded in spreading a message of market-driven reforms under the auspices of the World Bank, the United Nations, and the International Monetary Fund (Farazmand 1999, 2012, 2017; Knafo 2019).

Managerialism is an umbrella term that essentially means to implant business-oriented structural processes and functional features into managing public affairs. The introduction of managerialism in the public sector dates to the 1980s primarily because of the ascendency of the neo-liberal market ideology, globalization, and the deteriorating performance of public sector organizations worldwide (Farazmand 1999). Managerialism began its journey in New Zealand and Great Britain and soon spread to other parts of the world. Managerial processes include strategic planning, customer orientation, performance management, managing for results, and EO. The model also emphasized competition, essentially implying the outsourcing of public services to the private and non-profit sectors and public private partnerships (Hood 1991; Kim 2010; Pollitt and Bouckaert 2017).

During the momentous ethos of globalization, public sector transformation has embraced the precepts of entrepreneurship and EO since the 1980s (Shockley et al. 2006; Kim 2010; Haque 2020; Naldi et al. 2020). Seminal works have underscored the need for public sector entrepreneurship in different forms to revamp the structure and processes of public sector organizations (Osborne 1992; Hood 1995). While there is no dearth of criticisms about globalization, Farazmand (2009, p. 1010) “argues for the inevitability of globalization as a historical development and suggests adaptability and innovation as a response strategy while warning against its threats to national, sovereignty, self-determination, and democratic governance and public administration”. This article considers the influx of entrepreneurial spirit into public service management as what Farazmand calls a significant adaptive and innovation strategy amidst the turmoil of globalization and institutional failures (Farazmand 2009, 2012, 2020).

There is no consensus about the definition of public sector entrepreneurship. Morris and Jones (1999, p. 71) define public sector entrepreneurship as “creating value for citizens by bringing together unique combinations of public and private resources to exploit social opportunities”. In the literature, public sector entrepreneurs are categorized as political entrepreneurs, policy entrepreneurs and bureaucratic entrepreneurs (Holcombe 2002; Arnold 2019). The notion of bureaucratic entrepreneurs resonates well with NPM or entrepreneurial government.

However, public entrepreneurship can also be conceptualized in terms of its roles. Klein et al. (2010) observed that public sector entrepreneurs are engrossed in changing the institutional environment, creating new public agencies, inventive management of public resources, and availing the advantage of spillovers by private actions to the public domain. Remarkably, the fourth role pertains to the proliferation of the third party (private and non-profit sectors) in providing public services to the citizenry (Kim 2010; Klein et al. 2010).

The roles played by public sector entrepreneurs vary. However, they mostly have to do with creativity and pro-activeness. They also involve steering public organizations away from bureaucracy to flexible governments that are result-oriented and guided by measurable performance according to performance indicators (Hood 1991). Morris and Jones (1999) acknowledged that public-sector entrepreneurship is essential because it enhances efficiency and productivity. Shepherd (2017) added that managerialism is ideal for organizations because it is vital and universally applicable. The exponents of public sector entrepreneurship identify several attributes of bureaucratic entrepreneurs as opposed to conventional Weberian bureaucracy. These include, among other things, creativity and innovativeness, a knack for public value in creating new programs, explicit focus on outputs and outcomes, keenness to withstand profound challenges in turbulent environments, emphasis on service quality as per the demands of the citizens, pro-activeness and so forth (Kim 2010; Diefenbach 2011; Demircioglu and Chowdhury 2021).

EO is one of the significant constructs of entrepreneurship. EO encompasses a “firm’s decision-making practices, managerial philosophies, and strategic behaviours that are entrepreneurial in nature” (Wales 2016, p. 4). EO enables individuals to transform through innovativeness, pro-activeness, and risk-taking inclination (Diefenbach 2009; Wales et al. 2020). Miller (1983) discussed the core dimensions of EO, such as risk-taking, pro-activeness and product innovation. Innovativeness pertains to adopting and implementing new ideas in products, technology, policy, and processes (De Vries et al. 2016). Risk-taking orientation implies that managers are willing to confront threats and make bold decisions involving significant resources (Miller and Friesen 1978). Variations in the innovativeness, risk-taking, and pro-activeness of public organizations exist worldwide, however, their necessity cannot be overemphasized (Swann 2016; Kraus et al. 2019; Moon et al. 2020).

How EO impacts the growth of organizations is an issue to be examined. In the mainstream management literature, organizational growth is one of the measures of overall performance (Wiklund and Shepherd 2005; Wang 2008; Real et al. 2014; Engelen et al. 2015; Kearney and Meynhardt 2016; Rezaei and Ortt 2018). The measures embodied in the growth of an organization include sales, revenues, employees, and customers (Weinzimmer et al. 1998). The literature in management studies shows the positive impact of EO on a firm’s overall performance, including the organization’s growth. Zhao et al. (2011) observed that the positive impact of EO on business performance was not uniform across different contexts. While reviewing the literature about the relationship between EO and the GoG, the study identified LO and OS as critical variables in the EO–GoG nexus.

LO refers to the availability of values affecting the extent to which an organization questions its theories, mental models, and the most dominant logic (Li et al. 2008). LO signifies a fundamental attitude towards learning. It entails three organizational values influencing an organization’s tendency to create and use knowledge. These values include management’s commitment to learning, shared vision and open-mindedness (Sinkula et al. 1997; Kinder 2012). An organization’s commitment to learning helps to support a culture that fosters LO.

OS combines methods that separate but coordinate organizational tasks (Willem and Buelens 2009). Five dimensions of OS are frequently found in the literature. These are specialization, standardization, formalization, centralization, and configuration (Pugh et al. 1968). Following Burns and Stalker (1961), the current study focused on two dimensions of OS—formalization and centralization. A high level of formalization refers to organizations that are highly structured, where rules, procedures, and guidelines are strictly enforced, and the organization relies on written, standardized instructions to guide employees. A high level of centralization refers to a top-down approach where decision-making power is concentrated in top leadership. Both structures command their authority from rigid structures making it less likely to be receptive to organizational changes (Pugh et al. 1968; Venkateswarlu et al. 2020).

3. Development of Propositions and a Research Framework

The EO–GoG nexus is a complex phenomenon. This section develops several propositions with the support of pertinent conceptual and empirical studies. Because there is a dearth of empirical research on the selected constructs and their relationships, business management literature that resonates with the propositions has been used. After the presentation of propositions, the conceptual framework is proposed (Figure 2).

3.1. Entrepreneurial Orientation and the Growth of Government

EO is the most crucial element for organizations to have a higher competitive advantage and consequent growth in the market. The proxies of EO—pro-activeness, risk-taking and innovativeness—make it possible for firms to become financially successful (Anwar and Shah 2021). When the top managers favour the elements of EO, firms undoubtedly achieve a higher level of growth (Linton and Kask 2017). Additionally, investment risk positively impacts a firm’s growth (Andries et al. 2020).

The limited empirical literature in public sector management points out the positive relationship between EO and GoG (Alonso et al. 2015; Baba 2015; Real et al. 2014). For appropriate public organization management, managers are expected to foster a culture that incorporates innovativeness, risk-taking, pro-activeness, and accountability for growth purposes (Swann 2016). An empirical study by Alonso et al. (2015) invalidates the claim of NPM reformers that NPM will reduce the size of the government measured in terms of the ratio of GDP to public expenditure. According to Klein et al. (2010), public sector entrepreneurs contribute to the GoG. They create new public organizations by exploring new opportunities, marshalling new resources and implanting new institutions and organizations. Based on this review, the following proposition is drawn:

Proposition 1.

EO renders a positive impact on the GoG.

3.2. Entrepreneurial Orientation and Learning Orientation

EO is intimately linked with LO. While EO may have an important impact on organizational performance, it still needs LO to create a conducive climate that promotes the mutual relationship between the organization and its members (Wang 2008; Kinder et al. 2019; Al-Shami et al. 2022). Learning capability acquisition helps organizations to maximize the impact of innovation on performance (Tajeddini 2009, 2016; Huang and Wang 2011; Real et al. 2014; Nikraftar and Momeni 2017). Further, equipping organizations with adequate resources gives them a competitive advantage which is an impetus for innovation, and innovation becomes a fundamental form of organizational learning (Real et al. 2014).

In the public sector, bureaucratic entrepreneurs must be innovative, risk-takers and proactive in creating a learning environment. The EO and LO relationship is also vital in modern public organizations (Harrison and Leitch 2005; Wang 2008; Salge and Vera 2012; Sirén et al. 2017; Khan and Bashir 2020).

3.3. Learning Orientation and Growth of Government

When an organization identifies that learning is essential, it asks its employees to understand the new knowledge (Real et al. 2014; Nikraftar and Momeni 2017). Tajeddini (2009, 2016) empirically validated how newly learned knowledge enhanced performance outcomes, including GoG in the Iranian public sector.

The efficient dissemination of knowledge also plays an essential role in encouraging risk-taking and pro-activeness in an organization (Huang and Wang 2011; Real et al. 2014). Additionally, organizations need a strong LO (commitment to learning, open-mindedness and shared vision) to be competitive (Calantone et al. 2002; Patky 2020; Hussein et al. 2014). In public management, the adoption of precepts such as performance orientation—an offshoot of the innovation–LO nexus—has been helpful in the efficient and effective running and expansion of government programs (Klein et al. 2010; Baba 2015; Haque 2020). Following this review of literature, it is proposed that:

Proposition 2.

LO has a positive effect on the GoG.

3.4. Entrepreneurial Orientation, Learning Orientation, and the Growth of Government

EO alone is insufficient for GoG because it offers an incomplete picture of organizational success. Recent studies show a missing link in the form of LO between EO and organizational performance (Baba 2015; Calantone et al. 2002; Hussein et al. 2014) EO is a process that shows an organization’s tendency to innovate, willingness to take risks for higher growth and responsiveness in a proactive way to the demands of consumers (Harrison and Leitch 2005). LO is a mediating factor between EO and GoG (Wang 2008). Therefore, following this review of literature, it is proposed that:

Proposition 3.

EO positively effects LO, which in turn impacts the GoG.

3.5. Organization Structure, Entrepreneurial Orientation and Learning Orientation

There is a relationship between OS and LO (Shoghi and Safieepoor 2013). Kim’s in-depth study indicates that the successful adoption of entrepreneurial strategy in the public service setting is contingent upon the appropriate fit for the organizational characteristics in terms of structure and processes (Kim 2010). EO is higher in less complex and formalized organizations than in centralized and complicated OSs. A centralized OS tends to slow decision-making (Altinay and Altinay 2004). Kanten et al. (2015) also highlighted that OS is one of the most critical and practical components regarding establishing different dimensions of EO in organizations.

EO in the public sector depends on an OS’s management levels (Altinay and Altinay 2004). The tendency of top management to exercise control is an obstacle to adopting EO in the public sector (Morris and Jones 1999). It is also unclear whether resource constraints impede entrepreneurial actions of innovation, pro-activeness, and risk-taking (Singla et al. 2018). However, it is recognized that with a flexible OS in place, EO will have a positive impact on LO (Kim 2010). Based on the review, the following propositions are, therefore, developed:

Proposition 4a.

A high level of formalization weakens the positive relationship between EO and LO.

Proposition 4b.

A high level of centralization weakens the positive relationship between EO and LO.

3.6. Organization Structure, Learning Orientation, and the Growth of Government

EO refers to the ability of a firm to improve performance based on experience (Hamann et al. 2013). OS is an essential aspect of management. Demircioglu and Chowdhury (2021) argue that in the public sector, three leadership behaviors affect the employees’ entrepreneurial behavior—relations-oriented, task-oriented, and change-oriented leadership. Relations-oriented leadership behavior is essential to entrepreneurship in the public sector, suggesting the essence of building relationships with subordinates (Demircioglu and Chowdhury 2021; Rashman et al. 2009). LO in an organization cannot be realized without proper OSs (Sakalas and Venskus 2007; Hao et al. 2012). Klein et al. (2010) found that public entrepreneurship had the potential to augment public service organizational growth. However, LO can be better be harnessed through EO. In this situation, a flexible OS can maximize the impact of LO on GOG. Based on this review, the following propositions are developed:

Proposition 5a.

A high level of formalization weakens the positive relationship between LO and GoG.

Proposition 5b.

A high level of centralization weakens the positive relationship between LO and GoG.

4. Discussion

The study of the GoG is complex, given the fact that numerous factors play critical roles in the process. The discipline of economics makes a good contribution to analyzing the determinants of the GoG, although its arguments have been contested in several studies (Blais and Dion 1990; Schuknecht 2020).

The emergence of NPM has opened a new horizon to explore the impact of organizational-level determinants on the growth of government. This perspective was absent in the studies of economic and political studies of the growth of government.

Public entrepreneurship and its sub-construct EO have gained increased attention in both the academic and practical domains of public sector management after the emergence of NPM. This article considered the substantial reforms sweeping the public sector across the globe. Two critical prescriptions of the neo-liberal market ideology—small governments and the marketization of public services—have become hallmarks in the globalized world (Hamann et al. 2013). Our study identified a contradiction between the notions of public sector entrepreneurship and small states, although both notions are ingrained in managerialism. Beginning from a state of apprehension about the applicability of entrepreneurship, public sector organizations have demonstrated their maturity by being able to introduce radical changes (Morris and Jones 1999; Dhliwayo 2017; Hayter et al. 2018).

The adoption of the hermeneutic quantitative research approach helped identify and analyze the most pertinent literature that ultimately resulted in the development of research propositions.

EO requires the support of learning and favorable structures to positively impact the organization’s growth. Three major OS sectional divisions include top management, middle management, and functional management. Morris and Jones (1999) highlighted that functional and middle-level management tend to be more entrepreneurial. Notably, obstacles to EO in public sector organizations primarily happen at the top of the management systems. Meynhardt and Diefenbach (2012) observed positive effects of NPM among middle-level managers in the German public sector.

The conceptual model and the propositions developed in this article signify a sharp departure from the previous studies as discussed in the second chapter. The new framework shows the new perspective of understanding the GoG focusing on the interplay of organizational variables and its impact on GoG.

Although this article does not reflect on the external factors impinging on EO, several studies have underscored that resources and liberal democracy are critical enablers of EO (Obeng and Sakyi 2017; Yang and Yu 2022). However, empirical evidence suggests that public sector organizations have also developed EO in illiberal, non-democratic settings (Obeng and Sakyi 2017).

5. Conclusions: Theoretical and Managerial Implications, Limitations, and Future Research Directions

This article has deliberated on the under-researched phenomenon of the GoG and its organizational enablers such as EO, LO and OS. In the light of the lack of a comprehensive framework underlying the impact of critical organizational constructs on the GoG, this paper aimed to fill that gap.

It is evident that public service management has undergone radical changes over last four decades or so. The old model of public sector management was supplanted by the NPM in an age of globalization and the triumph of the neo-liberal market ideology. NPM heralded a new era of research. As such, the study of entrepreneurship, once the exclusive domain of management studies, has made inroads into the intellectual and practical domains of public sector management. EO, a dominant construct in the study of entrepreneurship, has proved its efficacy in augmenting public service performance.

The growth of government as an important area of study was largely dominated by economists and political scientists. In addition, scholars in these fields largely relied on country level time series and panel data to study the determinants of GoG. Therefore, methodologically, there remain gaps pertaining to the negligence of organizational level determinants. To address this gap, this study has attempted to construct a research framework facilitated by the hermeneutic qualitative research approach-enabled literature review. After a thorough overview of existing literature, a conceptual framework associated with some propositions has been developed with the support of pertinent literature.

In this paper, the GoG as an outcome is shown to be influenced by EO with the intervening roles of OL and OS. It is evident that all public organizations must inculcate EO. However, a public organization that aims to become entrepreneurial must be willing to acquire and improve existing knowledge. In addition, two critical dimensions of OS—formalization and centralization—may negatively or positively influence both EO and LO.

The new research framework is expected to serve as a springboard for empirical research across diverse public administration systems across the globe. The strength of this framework is that clear propositions have also been developed, paving the way for vigorous qualitative research at the organizational level. Another advantage is that the propositions herein can be converted into hypotheses that facilitate quantitative research. In this sense, this study provides significant theoretical insights into the relationship between EO, LO, OS, and GoG in context of public service organizations. An integrated framework is developed. This study is the first to integrate several factors into a single framework and thoroughly examine their relationships, unlike previous research that only focused on individual links.

This research contributes to our understanding of public sector entrepreneurship and GoG. The findings suggest that public sector organizations can foster innovation by adopting an entrepreneurial orientation, which is characterized by risk-taking, proactiveness, and innovation-seeking behaviours. Additionally, the study highlights the importance of a supportive organizational structure that encourages knowledge sharing and collaboration. In addition, it provides a newer perspective of the role of entrepreneurship and innovation in augmenting the growth of government.

Furthermore, this study emphasises key practical implications for public sector managers and policymakers aiming to enhance innovation and development outcomes in government organizations. The results highlighted the crucial role senior managers may have in fostering EO and LO among teams of public workers as they significantly impact GoG.

This article is not without limitations. There are many pertinent organizational constructs in literature. For this study, only a handful of constructs were selected after an extensive review of literature. Some critical variables such as leadership, strategy, social capital, and organizational culture were omitted.

The next phase of the study would be to test the model in the empirical setting. Based on the results obtained from empirical research would be great importance to refinement of the conceptual framework and research propositions.