2. New ventures in emerging markets: comprehensive review and future directions

Both researchers and practitioners have paid considerable attention to the significant role of new ventures (that is, firms younger than eight years) in the global economy (Oviatt & McDougall, 1994; Zahra, Ireland & Hitt, 2000). The increasing growth of new ventures has not only added more products and services to the market and stimulated market competition, but also provided more employment opportunities and improved the quality of life of people (McDougall & Robinson, 1990; Vesper, 1980). Thus developing new ventures has been viewed as both a revitalization tool for developed economies and a driving force for emerging markets (Cooper, Willard & Woo, 1986; Li & Atuahene-Gima, 2001; Zhao & Aram, 1995). Recent literature has suggested that emerging markets are a rich landscape of opportunity allowing new ventures to capitalize on growth (Li, 2001). An emerging market is generally defined as one that often has low per capita income but with a rapid pace of economic development, and government policies favouring economic liberalization and a free market economy (see Hoskisson, Eden, Lau & Wright, 2000). According to Hoskisson et al. (2000), emerging markets not only include developing economies in Latin America, the Middle East, Southeast Asia and Africa, but also transition economies such as China, Central and Eastern Europe, and the former Soviet Union. These transition economies are changing from formal planned economies to market economies based on privatization and emphasis on entrepreneurial activities (Zahra, Ireland, Gutierrez & Hitt, 2000). Compared to their counterparts in developed markets, new ventures in emerging markets face significant challenges from their fast-changing environment. For example, in developed market economies such as the US, new ventures can acquire critical resources (for example, managerial