Theoretical Integration of Emotional Intelligence and National Leadership: Consequences for SME Development in Emerging Economies

Abstract

Emotional Intelligence (EI) has become a fundamental leadership attribute marked by maturity and ongoing development, especially in the context of national government. Small and Medium- sized Enterprises (SMEs) are essential to economic development, representing 40% of Pakistan’s GDP and providing employment for 80% of the non-agricultural labor population. It's evident that SMEs are crucial for economic growth and employ a substantial segment of the population, constituting the biggest voting demographic for national leaders. Notwithstanding their significance, SMEs in developing countries have enduring obstacles, such as restricted access to financing, regulatory inefficiencies, and political instability. Comprehending the emotional intelligence of national leadership and its relationship to sustainable economic development at the grassroots level is essential for all stakeholders, including politicians, small and medium-sized enterprise owners, and people. This research, based on a comprehensive literature analysis rather than empirical surveys, examines how emotionally intelligent leadership cultivates inclusive policies that enhance innovation, revenue growth, employment expansion, and sustainability in SMEs. A conceptual framework is suggested that integrates Goleman’s Emotional Intelligence Theory with Mayer and Salovey’s Four-Branch Model, connecting emotional intelligence traits—self-awareness, self-regulation, motivation, empathy, and social skills—to quantifiable small and medium-sized enterprise results. This study synthesizes ideas from more than 40 peer-reviewed studies, highlighting the transformational potential of emotionally intelligent leadership in formulating adaptive policies and fostering inclusive economic development. This research offers practical insights for policymakers and stakeholders to emphasize emotional intelligence in leadership, hence ensuring sustainable growth in developing economies.

Keywords: Emotional Intelligence, National Leadership, Small and Medium Enterprises, Emerging Economies, Maturity, Continuous Evolution, Policy Adaptation, Sustainability, Electorate, Goleman’s Emotional Intelligence Model, Mayer and Salovey’s Four-Branch Model.