In addition to the importance

In addition to the importance of entrepreneurial activities the economic policies participates to create an attractive business environment to increase entry density. Last model results presented in Table 5 models 5 and 6 show the positive significant effect of inflation rate on entry density, as estimates of coefficient is (3.18) in innovative stage countries and (0.082) in efficiency driven countries.
Implication and limitation
Introduction In the past decade, startups have been in the spotlight in all countries; particularly in developing economies where they are considered as an important economic growth factor and a source of sustainable employment. Some experts believe that startups and emerging market economies can recover from the worldwide economic crises more rapidly compared to large companies and advanced market economies (Kose, Otrok, & Prasad, 2012). Therefore, startups can be considered as new engines of worldwide economic growth (Wälti, 2009). Previous studies showed that between one-fourth to approximately one-third of the variation in economic growth and development in many industrialized countries is due to the creation of new independent businesses (Carter, Gartner, Shaver, & Gatewood, 2003; Davidsson, Lindmark, & Olofsson, 1994; Reynolds, 1994; Reynolds & Maki, 1990; Reynolds, Hay, Bygrave, Camp, & Autio, 2000). According to U.S. Small Business Administration (SBA) (2014) about 50% of all new businesses survive five years or more and roughly one-third of them survive ten years or more. In addition to this, the level of enos inhibitor among firms has moved from the local markets to the global markets (Nyaoga, Wang, & Magutu, 2015). In other words the business environment is experiencing excessive competition as customers have become more aware of the competing products and services and regularly search for new options. Therefore, it is easy to claim that no organization except monopolists can survive in this competitive business environment without having loyal customers (Afsar, 2010; Riasi, 2015). Therefore, customer loyalty is considered as the key to business success. Experts believe that customer loyalty is rapidly becoming the marketplace currency of the twenty-first century which indicates that the value of the firms can be determined by the degree of their customers’ loyalty (Singh & Sirdeshmukh, 2000). Studies showed that increasing customer loyalty can affect the profitability of the firms and can lead to reduced marketing and customer acquisition costs (Gee, Coates, & Nicholson, 2008). The study of Reichheld (1992) indicated that depending on the particular industry, after a 5% reduction in customer migration it might be possible to increase the profitability by up to 60%. Therefore, it is easy to see that the retention of loyal customers can positively affect the long-term prosperity of the companies (Kuusik, 2007). For startups in financial services industry, customer loyalty is a more complicated issue and it is becoming significantly important. Insurance companies are an example of financial services firms which compete in a complicated and competitive business environment and should use their limited resources in order to increase their customers’ loyalty. The high costs of new customer acquisition have made the initial stages of customer–provider relationship less profitable for the firms. Therefore, the relationship between firms and their new customers is only profitable in later stages after the customers become loyal and the firms become more cost efficient (Riasi & Pourmiri, 2015; Wang, Lo, & Hui, 2003). According to Menelec and Jones (2015), small professional service businesses lack the business/marketing language which is necessary to articulate their approaches and values to their customers. Historically, the firms competing in Iranian insurance industry have not been very successful in constructing long-term relationships with their customers. As small private insurance companies (i.e., non-government owned and non-government sponsored insurance companies) entered this industry, competitiveness among firms significantly increased. As private insurance companies emerged in Iran, the customers’ expectations from their service providers increased. Therefore in order to be successful in customer acquisition and customer retention, the Iranian insurance firms have to identify the factors affecting customer loyalty (Bahramzadeh & Shokati Moghareb, 2009) and should adjust their marketing strategies according to these factors. One purpose of this study is to identify the factors that affect the customer–service provider relationship in the insurance industry.