The influence of values and the culture on entrepreneurial activity: an analysis of the difference between countries with different development levels

Abstract

This paper tries to explain the considerable differences between countries in the TotalEntrepreneurial Activity (TEA) index, by analysing the values and motivations that driveentrepreneurial activity. Moreover, we have found, and taken into account, that the country’seconomic development conditions the appearance of personal values and motivations.Researchers have traditionally considered the needs for achievement and independence asthe main drivers of the individual’s entrepreneurial behaviour. But these elements have notoften been considered at the country level or in relation to the TEA index. The main argumentof the current work is based on the premise that a country’s development level implies boththe type of needs that remain unsatisfied and what the society values. Unsatisfied needsare determinant motivating elements of behaviour according to Maslow, and they explainsome of the differences in entrepreneurial activity levels. We use aggregate measures ofthe value accorded to money, security, affiliation, achievement, and prestige, since thesevariables have been considered relevant in explaining people’s entrepreneurial behaviour.We also consider a number of economic and social factors as control variables. The datacomes from 28 countries participating in the Global Entrepreneurship Monitor (GEM)project, the World Values Survey (WVS), and the Global Leadership and OrganisationalBehaviour Effectiveness (GLOBE) research programme. We have also used data aboutthese countries from the World Bank. In order to test the proposed hypotheses we used theregression analysis. The results obtained confirm the relevance of motivations and valuesin explaining countries’ entrepreneurial activity levels. The findings indirectly suggestthe need to examine achievement motivation in more depth, and its possible non-linear(inverted U-shaped) relation with entrepreneurial activity.