Journal of Economic Education and Entrepreneurship Studies
Vol. 7 No. 2 (2026)

Strategic Determinants of MSME Sustainability: Market Competition Mediation and Institutional Regulation Moderation Effects

Ariefah Sundari (Darul Ulum Islamic University, Indonesia)
Meithiana Indrasari (Dr. Soetomo University, Indonesia)
Sukesi Sukesi (Dr. Soetomo University, Indonesia)



Article Info

Publish Date
16 Apr 2026

Abstract

This study examines the strategic determinants of MSME sustainability in East Java by investigating the effects of credit facilities, digital marketing, innovation strategy, pricing strategy, distribution strategy, circular economy, and inclusive partnerships. Market competition is positioned as a mediating variable, while institutional regulation acts as a moderating variable. A quantitative explanatory research design was employed using survey data collected from 396 MSMEs selected through simple random sampling across East Java. Data were analyzed using Structural Equation Modeling–Partial Least Squares (SEM-PLS). The findings reveal that credit facilities, digital marketing, innovation strategy, pricing strategy, distribution strategy, circular economy practices, and inclusive partnerships significantly influence MSME sustainability. Market competition mediates the relationship between strategic factors and sustainability, indicating that competitive dynamics enhance the effectiveness of internal business strategies. Institutional regulation also moderates the relationship between market competition and sustainability by supporting a fair and conducive business environment. These findings demonstrate that MSME sustainability is determined by the interaction of strategic capabilities, competitive market conditions, and supportive institutional frameworks.

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Journal Info

Abbrev

JE3S

Publisher

Subject

Economics, Econometrics & Finance Other

Description

1. Economics Education Curriculum development and learning outcomes in economics education Pedagogy and instructional innovation in economics learning Assessment, evaluation, and measurement of economics learning Development of learning materials and instructional resources for economics Development ...