Varieties of entrepreneurship: institutional drivers across entrepreneurial activity and country

Abstract

This paper adapts the approach introduced in the literature on disparate varieties of capitalism by proposing that different varieties of entrepreneurship exist. We make the case for the existence of disparate varieties of entrepreneurship by exploring and analyzing three distinct varieties of entrepreneurship that are prevalent but typically analyzed separately in the entrepreneurship literature: new firm start-up, self-employment, and early stage entrepreneurial activity. Using 5 years of data from 44 countries, we highlight the variation in both the conceptualization and the measurement of entrepreneurship across time and geographic context. Our results suggest that institutional factors influence the disparate varieties of entrepreneurship differently: property rights, freedom from corruption, and fewer start-up procedures are significantly positively related to nascent/new firm ownership. Property rights protection is significantly positively related to new firm start-up; tax and regulatory burden have significant positive impacts on self-employment but significantly negatively related to new firm start-up. Our findings suggest that the disparate varieties of entrepreneurship are not at all substitutes and are related in very different ways to institutional factors.