This paper systematically analyzes the role of formal and informal institutions in shaping entrepreneurial activity dynamics, and specifically examines the distinction between entrepreneurial opportunities and entrepreneurship in the context of different stages of economic development. In theoretical theories of institutional economics, formal institutions include property rights, business regulations and freedoms, financial freedoms, and government support policies, and informal institutions include cultural norms, social networks, public trust, and fear of failure, and are analyzed simultaneously. Using a panel of 85 countries over the period 2010-2023 and based on the World Economic Forum classification, the present study separates countries into economic groups based on factors of production, efficiencies, and innovation-oriented factors to create structural heterogeneity due to institutionalization. The results of the fixed model values ​​and generalized moment methods suggest that in innovation-driven economies, strengthening formal institutions, especially business freedom and property rights, significantly stimulates the expansion of opportunistic entrepreneurship and high-growth entrepreneurial activities. In contrast, in factor-driven economies, the weakness of institutions allows informal institutions and social networks to play a compensatory and dominant role in shaping imperative entrepreneurship and the continuity of economic activities. The social and innovative findings of the research show that institutional asymmetry, meaning the mismatch between formal rules and informal norms significantly weakens the likelihood of the expansion of informal entrepreneurship and the need to increase the data and effectiveness of formal support policies for entrepreneurship. This article presents empirical evidence based on the alignment of formal institutional reforms with cultural and social contexts and provides clear policy implications for developing livelihood entrepreneurship into productive entrepreneurship and creating growth in economies today.