Contextualizing Necessity Entrepreneurship: A Cross-National, Comparative Perspective

Abstract

While the comparative international entrepreneurship literature has explored the effects of national context on the discovery, evaluation, and exploitation of market opportunities, less comparative work has examined the national characteristics that drive the intensity of needs-based pushes into self-employment. To fill this gap, we apply a needs-based perspective to explain the wide cross-national diversity in levels of own-account self-employment across 167 country cases. Our results provide evidence that a needs-based lens offers an important framework to not only compare the conditions of self-employment between developing and developed country settings, but also to identify significant variation within the developing world itself. By splitting our global sample in half by income level, we find that the institutional-based causal conditions that explain cross-national variation in the scale of own-account self-employment are only recognized if the world’s poorest countries are included in comparative analysis. In the discussion section, we address the issue of country-level selective sampling bias to advance a more inclusive international entrepreneurship research agenda that includes the analysis of needs, as well as opportunities, when comparing national contexts.