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Muppets and Gazelles: Political and Methodological Biases in Entrepreneurship Research

Paul Nightingale and Alex Coad

No 2013-03, SPRU Working Paper Series from SPRU - Science Policy Research Unit, University of Sussex Business School

Abstract: Despite an almost universally accepted belief outside academia that entrepreneurial activity is a positive driving force in the economy, the accumulated evidence remains largely inconclusive. The paper positions the increased interest in entrepreneurship since the 1980s within its historical context and highlights the significant methodological problems with its analysis. Taking these problems into account it re-evaluates the performance of entrepreneurial firms in terms of innovation, job creation, economic growth, productivity growth, and happiness to show how both positive and negative interpretations can emerge. A pattern of increasingly positive interpretation is observed as one moves from analysis to policy. To address this bias, the paper suggests the single category ‘entrepreneurial firms’ be broken up along a continuum from the large number of economically marginal, undersized, poor performance enterprises to the small number of high performance “gazelles” that drive most positive impact on the economy. This would allow a more realistic evaluation of the impact of entrepreneurs by avoiding a composition fallacy that assigns the benefits of entrepreneurship to the average firm.

Keywords: Entrepreneurship; Jon creation; Self-employment; New firm formation; Innovation (search for similar items in EconPapers)
JEL-codes: J24 L26 M13 (search for similar items in EconPapers)
Date: 2013-10-09
New Economics Papers: this item is included in nep-cse, nep-ent, nep-ino and nep-sbm
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Citations: View citations in EconPapers (30)

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Journal Article: Muppets and gazelles: political and methodological biases in entrepreneurship research (2014) Downloads
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