National Systems Of Entrepreneurship Research Articles

Opportunity or necessity entrepreneurship? A study based on the national system of entrepreneurship

This study investigates synergies between individual and national variables that promote opportunity and necessity entrepreneurship with a framework based on the national system of entrepreneurship. A qualitative comparative analysis of fuzzy sets of 39 country cases shows that institutional or individual cognitive elements are not necessary for high-opportunity or high-necessity entrepreneurship but that enhancing entrepreneurs’ ability perceptions play a universal role. The study's findings reveal optimal pathways that combine the institutional environment and individual perceptions to promote the synergistic development of opportunity and necessity entrepreneurship and reduce differences in entrepreneurial activities between countries.

Entrepreneurship as a transition to the circular economy

AbstractGiven the challenges facing businesses and society in mitigating climate change, creating and supporting sustainable entrepreneurship is critical. However, the influence of National Systems of Entrepreneurship (NSEs) on the circular economy has not yet been studied. Our research studies the impact of NSEs on countries' circular economies while assessing the impact of the digital transition on this relationship. Using dynamic panel econometric techniques and by using various international databases, it was possible to assess the effect of NSEs on the circular economy. Furthermore, our analysis also allowed us to research how the impact of the digital transition may influence the relationship between NSEs and the circular economy. We achieve that countries with advanced NSEs achieve superior grades in their circular economy. We intend to add to the theoretical field by extending the knowledge of the relationship between NSEs and the circular economy. We also intend that the various actors in the surrounding environment who enhance entrepreneurial activities, realize that entrepreneurship is a fundamental component, within the system to which it belongs, for achieving the circular economy.

Evaluating efficiency and technology gaps of the national systems of entrepreneurship using stochastic DEA and club convergence

Evaluating efficiency and technology gaps of the national systems of entrepreneurship using stochastic DEA and club convergence

A composite indicator analysis for optimizing entrepreneurial ecosystems

• We use the ‘benefit of the doubt’ (BOD) weighting to evaluate the entrepreneurial ecosystem at the global scale. • We compute endogenous weights to identify country-specific policy priorities. • We show how countries can design optimal entrepreneurship policy using objective criteria. • Effective policy is conditional on the configuration of countries’ entrepreneurial ecosystem. • Quality improvements in entrepreneurial ecosystems are conducive to higher levels of venture capital investments. We employ the ‘benefit of the doubt’ approach rooted in non-parametric techniques to evaluate the entrepreneurial ecosystem of 71 countries for the period 2016. By scrutinizing the relative efficiency of countries’ entrepreneurial ecosystems, the proposed analysis of composite indicators allows the computation of endogenous (country-specific) weights that can be used for developing more informed policy making. The results show that countries prioritize different aspects of their national system of entrepreneurship which confirms that, contrary to homogeneous prescription, tailor-made policy is necessary if the objective is to optimize the resources deployed to enhance the countries’ entrepreneurial ecosystem. The findings of the empirical application reveal significant improvements in the quality of the entrepreneurial ecosystem can be realized by targeting the policy priorities of the local entrepreneurship system identified by the ‘benefit of the doubt’ weights. By analyzing the variation in economic and entrepreneurship outcomes over the seven-year period centered on the study year (period 2013–2019), we found a significant positive correlation between quality improvements in the entrepreneurial ecosystem and venture capital investments.

Avaliação da validade do Global Entrepreneurship Index

Purpose: our objective is to assess whether the Global Entrepreneurship Index (GEI) is a valid methodology for measuring the national systems of entrepreneurship. Theoretical framework: we use the structural equation modeling (SEM) as a theoretical lens to evaluate the Global Entrepreneurship Index. Design/methodology/approach: to achieve the research objective, we perform structural equation modeling to measure the formative model of GEI, using the SmartPLS 3.0 software, in order to verify the convergent validity of the constructs; the collinearity of indicators and their relevance for measuring entrepreneurship. Findings: the results obtained show that the sub-indices and indicators are adequate to measure entrepreneurship. However, we identified that there is a need to replace the micro-level components of the opportunity perception and networking indicators which provide distorted results of what is understood as productive or high impact entrepreneurship. Research, practical and social implications: the main contributions of our study are directed to the indicators’ developers. We suggest the use of components that capture aspects associated with high-impact or technology-based entrepreneurship instead of any attempt to create a new business, as our results indicate that generic components provide short-sighted results on the state of entrepreneurship, hampering comparative studies at the country-level. Originality/value: although the GEI is based on the OECD recommendations for the construction of composite indicators (indices), we have not identified any studies (not even performed by the GEI developers) on the validity of the index as a methodology for measuring entrepreneurship.

A Global Entrepreneurship Efficiency Benchmarking and Comparison Study based on National Systems of Entrepreneurship and Early-Stage Business: A Data Envelopment Analysis Approach

National Systems of Entrepreneurship is defined as a nation’s resource allocation structure leading to entrepreneurial behaviors. However, the existing indicators of national framework conditions may have limitations in comparing the entrepreneurial efficiency of countries. Based on institutional theory, this paper presents a model to examine the efficiency of entrepreneurial activities stemming from the given conditions of a country and find benchmarks based on data envelopment analysis by scrutinizing inputs and outputs with static efficiency, dynamic efficiency, and strategic quadrant analysis. For this purpose, the study utilizes the Global Entrepreneurship Monitor dataset from 2015 to 2020 for 24 countries and presents the research questions regarding the differences in global entrepreneurial efficiencies, the countries for benchmarking, and the implications for entrepreneurial activities. The research implications suggest that diversifying the views on entrepreneurial efficiency may be valuable, and policymakers may focus on institutional conditions and entrepreneurial efficiency regarding the activity of early-stage businesses.

A Research Journey from National Systems of Innovation to National Systems of Entrepreneurship: Introducing the Sextuple Helix

National systems of innovation (NSI) have attracted substantial interest from public administrations, the scientific community and international organizations. Innovation is a key factor for countries to be competitive in the today’s global economy. Entrepreneurship is an innovation source that has gained importance in NSI research over the last few decades. This focus on entrepreneurship in the context of NSI has led scholars to propose novel concepts such as entrepreneurial ecosystems and the national system of entrepreneurship (NSE). This paper uses bibliometric methods and the Web of Science Core Collection (WoS CC) database to explore how entrepreneurship fits into NSI research and to study the increasing importance of entrepreneurship within this research field. The NSI conceptual framework is developed according to the most common keywords, and the most influential NSI studies are identified using the total number of citations and the ratio number of citations per year. Two sets of studies are analyzed: (1) older documents on traditional topics such as the origins and evolution of NSIs, the capacity of countries to innovate, and the relationships of institutions, different organizational forms, networking, production and competence building with innovation and (2) newer entrepreneurship research documents. Based on analysis of the most common keywords, the most influential studies and multiple entrepreneurship approaches, we propose a Sextuple Helix model as an analytical framework that brings together innovation and entrepreneurship.

The Legacy of Zoltan J. Acs

This paper reviews the scholarly contributions of Zoltan J. Acs, who served as a Co-Founder and Co-Editor in Chief since the inception of Small Business Economics. His scholarship serves as one of the foundations and cornerstones of the field of entrepreneurship. His contributions range from innovation to philanthropy and national systems of entrepreneurship.

Country-level efficiency and the index of dynamic entrepreneurship: Contributions from an efficiency approach

The objective of this article is to address aggregate performance indicators in National Systems of Entrepreneurship from an efficiency perspective. Our assessment is based on Data Envelopment Analysis (DEA) applied to data from the Index of Dynamic Entrepreneurship (IDE) for a sample of 60 countries. Besides providing information on the efficiency score of each country, this approach allowed the identification of benchmarks for best practices and the construction of an efficiency ranking. Findings offer guidance for refined entrepreneurship-oriented policies that take into account characteristics of heterogeneous socioeconomic contexts. Surprisingly, top-performing countries in the IDE ranking have relatively inefficient ecosystems while countries in the lowest positions generally demonstrate higher efficiency scores. Implications of our research encompass the need for policymakers to develop more in-depth knowledge concerning their own entrepreneurial ecosystems’ attributes and productivity. Efficient systemic outcomes can be obtained through different configurations, so a hierarchical view of attributes limits the adequacy of policies for different contexts.

National systems of entrepreneurship: goals of sustainability

PurposeNational systems of entrepreneurship (NSE) broadly act as a means of allocating resources driven by the constant search for opportunities at the individual level through the launching of new businesses and firms with such activities, and their results are governed by the specific institutional characteristics of each country. In contrast to the institutional emphasis on innovation systems, in which such institutions establish and regulate actions, institutions are only able to regulate those who act with the results stemming from such individual actions, the core driver of national entrepreneurship systems.Design/methodology/approachGiven the challenges faced by companies and societies in general over mitigating climate change, support for sustainable entrepreneurship is fundamental. However, there has to be any study of the impact of national entrepreneurship systems on sustainability. This research therefore analyses the impact of national entrepreneurship systems on the sustainability of countries.FindingsThe authors conclude that those countries deploying higher level national entrepreneurship systems return better results in terms of their sustainability.Originality/valueThe authors, thus, seek to contribute towards the academic throughout deepening the knowledge prevailing on the relationship between entrepreneurship and sustainability. The authors also seek to enable managers, entrepreneurs and politicians to grasp how entrepreneurship is a systemic factor, and it is at this level that it may make its greatest contribution to bringing about sustainability.

The global entrepreneurship index as a benchmarking tool? Criticisms from an efficiency perspective

PurposeBased on an efficiency analysis of the Global Entrepreneurship Index (GEI), the purpose was to demonstrate that the Key Performance Indicators’ analysis leads to a misinterpretation of the dynamics of National Systems of Entrepreneurship (NSEs). This might hamper the formulation of sound initiatives in other economies, with relevant implications for developing countries.Design/methodology/approachThis study categorized GEI indicators into output and input indicators. Following this procedure, each dimension was analyzed separately and then compared to each other, considering countries’ productivity rates. The main focus is given to the case of the US, the usual benchmark for NSEs and leader in the GEI Index. Lastly, a taxonomy of NSEs according to their efficiency levels was developed.FindingsThe findings of the analysis demonstrates that innovation-driven economies with lower positions in GEI ranking often have higher productivity rates when compared to economies with higher positions in GEI ranking. Specifically, the US appears not to be a good benchmark in terms of NSE efficiency.Research limitations/implicationsThe study’s approach is limited in scope by data availability on NSEs and the use of GEI, a representation of aggregate patterns of country-level entrepreneurial dynamics. More refined data are needed in order to clarify some insights from this research.Practical implicationsThe perception of systemic efficiency should be considered more thoroughly when designing dedicated entrepreneurship-oriented policies in other countries that aim at establishing a more vibrant entrepreneurial system while facing resource constraints.Social implicationsSimplistic views of systemic aspects may hamper the formulation of sound entrepreneurship-oriented initiatives with particularly relevant implications for public policy in laggard economies.Originality/valueThe value of this article relies on applied a simple metric – efficiency ratio – order than, e.g. data envelopment analysis to portray a key issue related to the interpretation of supranational rankings related to the entrepreneurship ecosystem make mainly by policymakers and scholars that is: pick the 1st one, follow the leader.

The global technology frontier: productivity growth and the relevance of Kirznerian and Schumpeterian entrepreneurship

We evaluate how country-level entrepreneurship—measured via the national system of entrepreneurship—triggers total factor productivity (TFP) by increasing the effects of Kirznerian and Schumpeterian entrepreneurship. Using a database for 45 developed and developing countries during 2002–2013, we employ non-parametric techniques to build a world technology frontier and compute TFP estimates. The results of the common factor models reveal that the national system of entrepreneurship is a relevant conduit of TFP, and that this effect is heterogeneous across countries. Policies supporting Kirznerian entrepreneurship—e.g., increased business formation rates—may promote the creation of low value-adding businesses which is not associated with higher TFP rates. Policy interventions targeting Schumpeterian entrepreneurship objectives—e.g., innovative entrepreneurship and the development of new technologies—are conducive to technical change by promoting upward shifts in the countries’ production function and, consequently, productivity growth.

An empirical investigation of country level efficiency and national systems of entrepreneurship using Data Envelopment Analysis (DEA) and the TOBIT model

The goal of this paper is to investigate effects of national systems of entrepreneurship on the country level efficiency, on addition we find what macro factors affect efficiency as well. From a comprehensive database of 59 countries using GEM, WDI, WCI for 2018 using data envelopment analysis (DEA) we find the results support the theoretical grounding of Global Entrepreneurship Index (GEI) hypothesis. The GEI methodology has been designed to capture the core features of the National Systems of Entrepreneurship theory. It approaches country-level entrepreneurship as a systemic phenomenon, which is driven by the interaction between individual-level actions and country-level framework conditions. While discussing country level framework, we have depicted key macroeconomic indicators in the analysis along with GEI index. The DEA analysis followed this framework to assess the performance of the study countries. Though inefficiency widely varies across countries, while the group of factor-driven countries is the most inefficient while innovation-driven economies are the most efficient ones. Subsequently, we apply the Tobit model to explain efficiency. Based on the Tobit regression model, the DEA VRS technical efficient score could be improved through GDP per capita and social capital. From policy perspective, to promote economic growth policy makers should consider national systems of entrepreneurship as their priority so that entrepreneurs can allocate resources in the economy effectively.

Entrepreneurship, Institutional Economics and Economic Growth: A Systems Perspective

National Systems of Entrepreneurship (NSE) are resource allocation systems driven by opportunity pursuit at the individual level. We investigate whether and in what ways entrepreneurship and institutions represent the “missing link” in explaining cross country differences in economic growth; we consider institutions in combination in NSE as well as independently, hypothesizing that the former will dominate the latter. We test these ideas using data from GEM survey and institutional sources for 46 counties in 2002-2011. We find support for our hypothesis: the entrepreneurial ecosystem is found to significantly influence economic growth while institutions and agency independently are only marginally significant.

Entrepreneurship, institutional economics, and economic growth: an ecosystem perspective

We analyze conceptually and in an empirical counterpart the relationship between economic growth, factor inputs, institutions, and entrepreneurship. In particular, we investigate whether entrepreneurship and institutions, in combination in an ecosystem, can be viewed as a “missing link” in an aggregate production function analysis of cross-country differences in economic growth. To do this, we build on the concept of National Systems of Entrepreneurship (NSE) as resource allocation systems that combine institutions and human agency into an interdependent system of complementarities. We explore the empirical relevance of these ideas using data from a representative global survey and institutional sources for 46 countries over the period 2002–2011. We find support for the role of the entrepreneurial ecosystem in economic growth.

Modern trends of development at regional business in Ukraine: national traditions and international experience

The article analyzes the essence of entrepreneurial processes at the regional and national levels, as well as entrepreneurial activity as a sphere of realization of economic motivation; recommendations on the improvement of the motivational mechanism of entrepreneurial activity in Ukraine are given on the example of the foreign experience. Within the framework of the article, an attempt is made to systematically comprehend the general laws of the development of entrepreneurship in a post-industrial economy and to analyze problems that related to the integration of the regional business environment into national business processes and seek ways to their solutions. The subject of research is the trends of development of regional business based on study of Ukrainian national traditions and international experience. The goal is to determinate the place and role of regional business in the national system of entrepreneurship as an actual mechanism for supporting the Ukrainian economy and its structural layers. The objective is to analyze the mistakes of an entrepreneur in the implementation of their projects and enterprises, as well as to solve problems that impede the development of business processes in the national economy. General scientific methods are used, such as: method of vertical comparisons – giving the opportunity to study the structure of phenomena and processes and trends in their change; grouping method – assumes the division of the studied set of objects into qualitatively homogeneous groups according to the corresponding characteristics; linear method – implies that the optimal variant is selected from a significant number of alternative options. The following results were obtained: the real motives of entrepreneurial activity are studied; the exceptional importance of creating new business technologies is determined; the state strategy of entrepreneurship development are obtained. Conclusions: one of the main tasks of small business support system in developed countries is to represent and protect the interests and needs of small businesses at various levels. A special feature of this process is the leading role of main government agencies and their active interaction with professional, public and other business associations. The basis of modern economic policy of the state should be in using the local and regional specifics, foreign experience in certain sectors of the economy, as well as support for education, science and private entrepreneurship.

National systems of innovation

The perhaps broadest approach to economic performance at the level of a country is the concept of national systems of innovation. Despite the emergence of a compelling literature identifying the persistence of innovative activities and country specific institutional effects, evidence on the nature of national systems of innovation is still missing and a number of crucial questions and answers remain unanswered. To shed light on these issues, as of leading scholars of entrepreneurship and innovation was assembled from around the world for a conference on “National Systems of Entrepreneurship and Innovation” at the ZEW Mannheim in November 2014. This article draws on the NSI framework, sets it in a larger context, examines the logic of the approach and introduces the special issue by summarizing the papers presented at the conference and selected for this special issue.

Impact of public seed-funding on academic spin-offs

In the entrepreneurial economy of today, it is not the multinational firms which are the predominant driver in the creation of new knowledge, but the individual entrepreneur. Correspondingly, new ventures of small size are leading in commercializing new knowledge and transferring it to the market. This economic shift has been reflected by broad entrepreneurship policies, which aim at supporting the individual on the challenge of a high-growth start-up. However, prior experience shows that uniform entrepreneurship policies do not address the individual needs in different countries and ecosystems adequately. In this paper, we study the performance of academic spin-offs that received public funding from the German EXIST Business Start-Up Grant, a support program which aims at increasing the number of innovative start-ups from academia. Using a control group matching approach, we provide evidence that these start-ups are smaller by two full time equivalent employees, generate 1.7 times higher losses and have a nearly three times lower return on capital than science-based entrepreneurial firms with comparable characteristics in the first 5 years after foundation. We interpret these results to be primarily caused by the inferior financial contracting structure of the program compared to private venture capital funding and by the resulting adverse selection and incentive effects on the entrepreneurs. The evidence calls for rethinking public interventions in a national system of entrepreneurship.

Entrepreneurial readiness in the context of national systems of entrepreneurship

This study contributes to the emerging stream of literature on national systems of entrepreneurship by investigating the importance of systemic contingencies between individual-level and country-level variables. Specifically, we develop the concept of entrepreneurial readiness as a factor consisting of four items relating to individuals’ skills, fear of failure, social connectedness, and opportunity perception. The results indicate that this entrepreneurial readiness construct is a more parsimonious and cogent representation of individual-level characteristics than several loosely connected individual traits. Moreover, we demonstrate that entrepreneurial readiness has substantial explanatory power with regard to individuals’ entrepreneurial intention. Individuals’ entrepreneurial intentions are also influenced by several dimensions of the national environment such that entrepreneurial readiness and these national environmental conditions are mutually reinforcing. These findings lend support to the importance of viewing entrepreneurship from a systems perspective and underscore the importance of institutional conditions in fostering entrepreneurship.

Entry and exit in severe recessions: lessons from the 2008–2013 Portuguese economic crisis

Under cleansing, productivity-enhancing reallocation is expected to be accelerated in recessions. In this paper we contribute to the analysis of one component of the national systems of entrepreneurship (namely capital market frictions) by showing that in the extreme scenario of deep recession efficiency in resource reallocation can actually be reduced. Using data from the pronounced Portuguese economic crisis, we do find a spike in firm exit in 2008–2012 vis-a-vis the 2004–2007 pre-crisis period, and a substantial increase in job destruction as well. But we did not find any strong evidence that job reallocation is countercyclical, while a non-negligible fraction of high-productivity firms actually shut down. In turn, our selected proxies for strictness in credit markets reveal that in deep recessions they are seemingly associated with increased firm exit and lower employment creation. Taken in round, our results show that credit market stringency in conjunction with an unfavourable economic cycle is likely to generate a long-lasting destructive process.