The Nature of Entrepreneurship and its Determinants: Opportunity or Necessity?

Gonçalo Brás and Elias Soukiazis ()

No 2014-22, GEMF Working Papers from GEMF, Faculty of Economics, University of Coimbra

Abstract: Within the institutional theory of North (1990, 2005), the objective of this study is to analyse the impact of economic and institutional factors, formal and informal, in the entrepreneurial activity of nations, particularly in Total Entrepreneurial Activity (TEA). In order to evaluate the simultaneous influence of economic and institutional factors on the entrepreneurial activity, a multiple regression approach is used with cross-country data sets. The results show that TEA is negatively related to infrastructural capacity and political stability of a country, and positively related to government spending and freedom of expression and corporate associations (Voice & Accountability) at a country level. It is also tested the relationship between TEA and GDP per capita. Our results confirm a convex relationship between the two variables giving evidence that the entrepreneurial activity is mostly necessity driven rather than motivated by opportunity.

Keywords: Entrepreneurship by necessity; Entrepreneurship by opportunity; Cross-country regression models; convexity hypothesis; threshold level. (search for similar items in EconPapers)
JEL-codes: C31 L26 M13 (search for similar items in EconPapers)
Pages: 53 pages
Date: 2014-11
New Economics Papers: this item is included in nep-cse, nep-ent, nep-gro and nep-sbm
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Published in Journal of Global Economics, Management and Business Research 3(4): 177-188, 2015.

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Persistent link: https://EconPapers.repec.org/RePEc:gmf:wpaper:2014-22.

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