The role of entrepreneurship in stimulating economic growth in developed and developing countries

Figures & data

Table 1. Summary and definitions of variables

Variable	Short definition
Entrepreneurial activity
Established business ownership rate	Percentage of 18–64 population who are currently owner-manager of an established business for more than 2.5 years
Informal investors rate	Percentage of 18–64 population who have personally provided funds for a new business started by someone else in the past 3 years
Nascent entrepreneurship rate	Percentage 18–64 population who are currently a nascent entrepreneur
New Business Ownership Rate	Percentage of 18–64 population who are currently owner-manager of a new business for less than 2.5 years
Total early stage entrepreneurial activity	Percentage of 18–64 population who are either a nascent entrepreneur or owner-manager of a new business
Necessity driven entrepreneurial activity	Percentage of those involved in TEA who are involved in entrepreneurship because they had no other option for work
Entrepreneurial aspiration
Growth expectations early stage entrepreneurial activity	Percentage of total early stage entrepreneurs who expect to employ at least five employees in five years time
New product early stage entrepreneurial activity	Percentage of total early stage entrepreneurs who indicate that their product or service is new to at least some customers
International orientation early stage entrepreneurial activity	Percentage of total early stage entrepreneurs who indicate that at least 25% of the customers come from other countries
Entrepreneurial attitudes
Entrepreneurial intention	Percentage of 18–64 population who intend to start a business within three years
Fear of failure rate	Percentage of 18–64 population with positive perceived opportunities who indicate that fear of failure would prevent them from setting up a business
Know start-up entrepreneur rate	Percentage of 18–64 population who know someone who started a business in the past two years
Perceived capabilities	Percentage of 18–64 population who believe to have the required skills and knowledge to start a business
Perceived opportunities	Percentage of 18–64 population who see good opportunities to start a firm in the area where they live

Note: Full definitions available from http://www.gemconsortium.org/data/key-indicators.

Table 2. Principle components analysis of variables

Component and composite variables	Scoring coefficients
Entrepreneurial activity
Established business ownership rate	0.3882
Informal investors rate	0.364
Nascent entrepreneurship rate	0.4247
Necessity driven entrepreneurial activity	0.2396
New business ownership rate	0.4782
Total early stage entrepreneurial activity	0.5003
Entrepreneurial aspiration
Growth expectations early stage entrepreneurial activity	0.6722
New product early stage entrepreneurial activity	0.5909
International orientation early stage entrepreneurial activity	0.446
Entrepreneurial attitudes
Entrepreneurial intention	0.4655
Fear of failure rate	−0.2815
Know start-up entrepreneur rate	0.438
Perceived capabilities	0.5206
Perceived opportunities	0.4911

Notes: In total one PC is retained for each of the three entrepreneurship categories. The decision to retain only one for each category is made as the Eigenvalue exceeds one only for the first principle component in each category.

Table 3. Results

	Full sample	High-income	Middle/low-income
$ln\left(\frac{K_{\mathit{it}}}{N_{\mathit{it}}}\right)$	0.6677**	0.3368**	0.6258**
	(0.0303)	(0.0697)	(0.0434)
$ln\left(H_{\mathit{it}}\right)$	0.7878**	0.2435	0.9554**
	(0.1787)	(0.2491)	(0.2419)
$ln\left(\frac{L_{\mathit{it}}}{N_{\mathit{it}}}\right)$	0.4992**	0.6960**	0.2397**
	(0.0778)	(0.0996)	(0.1071)
Entrepreneurial activity	−0.0219**	−0.0128	−0.0169**
	(0.0047)	(0.0092)	(0.0055)
Entrepreneurial aspirations	−0.0075	−0.0025	−0.0078
	(0.0047)	(0.0053)	(0.0065)
Entrepreneurial attitudes	0.0136**	0.0221**	−0.0041
	(0.0056)	(0.0066)	(0.0082)
Constant	2.1177**	6.7155**	2.0443**
	(0.2637)	(0.8159)	(0.3620)
Year dummies
2004	0.0173	0.0193**	0.0415*
	(0.0132)	(0.0113)	(0.0246)
2005	0.0182	0.0067	0.0921**
	(0.0131)	(0.0125)	(0.0233)
2006	0.0262**	0.0215	0.1117**
	(0.0131)	(0.0137)	(0.0230)
2007	0.0425**	0.0518**	0.1256**
	(0.0138)	(0.0149)	(0.0249)
2008	0.0434**	0.0529**	0.1360**
	(0.0138)	(0.0166)	(0.0243)
2009	0.0078	0.0178	0.0959**
	(0.0133)	(0.0164)	(0.0230)
2010	0.0128	0.0380	0.1135**
	(0.0139)	(0.0172)	(0.0252)
2011	0.0414**	0.0614**	0.1392**
	(0.0139)	(0.0183)	(0.0245)
Obs	271	180	191
R^2	0.9320	0.5333	0.8979

Notes: The coefficients for the three entrepreneurship variables show the impact of a one standard deviation change in the variable on the log of GDP per capita.

* Indicate significance at the 10% level.

** Indicate significance at the 1% level.

Table

Country	2004	2005	2006	2007	2008	2009	2010	2011
Argentina	x	x	x	x	x	x	x	x
Australia	x	x	x					x
Belgium	x	x	x	x	x	x	x	x
Brazil	x	x	x	x	x	x	x	x
Canada	x	x	x
China			x	x			x	x
Colombia				x	x	x	x	x
Croatia	x	x	x	x	x	x	x	x
Denmark	x	x	x	x	x	x	x	x
Slovakian Republic					x	x
Ecuador						x	x
Finland	x	x	x	x	x	x	x	x
France	x	x	x	x	x	x	x	x
Germany	x	x	x			x	x	x
Greece	x	x	x	x	x	x	x	x
Guatemala							x	x
Hong Kong	x
Hungary		x	x	x	x	x	x	x
Iceland	x	x	x	x	x	x	x
India				x	x
Iran						x	x	x
Ireland	x	x	x	x	x			x
Ireland
Israel					x	x	x
Italy	x	x	x	x	x	x	x
Jamaica			x			x	x	x
Japan	x	x	x	x	x	x	x	x
Latvia			x	x	x	x	x	x
Malaysia							x	x
Mexico			x					x
Netherlands	x	x	x	x	x	x	x	x
Norway	x	x	x	x	x	x	x	x
Pakistan								x
Peru				x	x	x	x	x
Portugal								x
Romania					x	x	x	x
Russia				x	x	x	x	x
Saudi Arabia							x
Serbia					x	x
Singapore	x	x	x
Slovenia	x	x	x	x	x	x	x	x
South Africa	x	x	x			x	x	x
Spain	x	x	x	x	x	x	x	x
Spain
Sweden	x	x	x	x				x
Switzerland							x	x
Taiwan								x
Thailand			x	x
Trinidad & Tobago								x
Tunisia							x
Turkey				x	x			x
UK	x	x	x	x	x	x
Uganda	x						x
United States	x	x	x	x	x	x	x	x
Uruguay				x	x	x	x	x