Country level efficiency and national systems of entrepreneurship: a data envelopment analysis approach

Esteban Lafuente, László Szerb and Zoltan Acs

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: This paper tests the efficiency hypothesis of the knowledge spillover theory of entrepreneurship. Using a comprehensive database for 63 countries for 2012, we employ data envelopment analysis to directly test how countries capitalize on their available entrepreneurial resources. Results support the efficiency hypothesis of knowledge spillover entrepreneurship. We find that innovation-driven economies make a more efficient use of their resources, and that the accumulation of market potential by existing incumbent businesses explains country-level inefficiency. Regardless of the stage of development, knowledge formation is a response to market opportunities and a healthy national system of entrepreneurship is associated with knowledge spillovers that are a prerequisite for higher levels of efficiency. Public policies promoting economic growth should consider national systems of entrepreneurship as a critical priority, so that entrepreneurs can effectively allocate resources in the economy.

Keywords: Knowledge spillover theory; GEDI; GEM; Efficiency; Data envelopment analysis; Clusters (search for similar items in EconPapers)
JEL-codes: C4 L20 M13 O10 (search for similar items in EconPapers)
Date: 2016-12-01
New Economics Papers: this item is included in nep-cse, nep-ent, nep-ino and nep-sbm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (30)

Published in Journal of Technology Transfer, 1, December, 2016, 41(6), pp. 1260-1283. ISSN: 0892-9912

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Journal Article: Country level efficiency and national systems of entrepreneurship: a data envelopment analysis approach (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:68907

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