Advertisement

Small Business Economics

, Volume 42, Issue 4, pp 685–701 | Cite as

National culture, entrepreneurship and economic development: different patterns across the European Union

  • Francisco LiñánEmail author
  • José Fernandez-Serrano
Article

Abstract

The aim of this paper is double. Firstly, it contributes to identifying the specific role of national culture as a variable that helps explain the level of economic development and reinforces the effect of entrepreneurship on the income level. Secondly, a deeper understanding of these relations in the case of the European Union is sought. In this study, data from two different sources have been used. The Schwartz Value Survey measures seven cultural orientations that are then grouped into three bipolar dimensions (embeddedness vs. autonomy, hierarchy vs. egalitarianism and mastery vs. harmony). The Global Entrepreneurship Monitor provides information regarding entrepreneurial activity. Using linear regression analysis, cultural and entrepreneurial variables are able to classify countries according to their development level, explaining over 60 % of the variance in Gross Domestic Product per capita. The role of culture is complex, with geographical elements being significantly relevant. In the case of Europe, some common elements conform what could be called “a European culture”: autonomy and egalitarianism clearly predominate over embeddedness and hierarchy, while harmony tends to prevail over mastery. Nevertheless, four well-defined groups of countries within the European Union emerge. Central and Northern Europe is closer to this European stereotypical culture, while English-speaking countries, Eastern Europe and the Mediterranean area exhibit their own differentiating elements each. These differences also exist with regard to entrepreneurial activity (overall Total Entrepreneurial Activity, necessity and opportunity-driven activity). Each of the four regional entrepreneurial cultures is characterized by a different entrepreneurial dynamics that may be plausibly explained by culture and income.

Keywords

Entrepreneurship Cultural values Economic development European Union 

JEL Classifications

A13 L26 R11 O52 

Notes

Acknowledgments

The authors are most grateful to the Editors and to three anonymous reviewers, whose comments and suggestions have contributed to improve the quality of this paper.

References

  1. Armington, C., & Acs, Z. J. (2002). The Determinants of Regional Variation in New Firm Formation. Regional Studies, 36(1), 33–45.CrossRefGoogle Scholar
  2. Audretsch, D. B. (2012). Entrepreneurship research. Management Decision, 50(5), 755–764. doi: 10.1108/00251741211227384.CrossRefGoogle Scholar
  3. Audretsch, D. B., Aldridge, T. T., & Sanders, M. (2011). Social capital building and new business formation. International Small Business Journal, 29(2), 152–169. doi: 10.1177/0266242610391939.CrossRefGoogle Scholar
  4. Bjornskov, C., & Foss, N. J. (2006). Economic freedom and entrepreneurial activity: Some cross-country evidence. DRUID Working paper, 06-18.Google Scholar
  5. Bosma, N., & Levie, J. (2010). Global Entrepreneurship Monitor: 2009 executive report. http://www.gemconsortium.org/. Accessed October 2011.
  6. Bosma, N., & Schutjens, V. (2011). Understanding regional variation in entrepreneurial activity and entrepreneurial attitude in Europe. The Annals of Regional Science, 47(3), 711–742. doi: 10.1007/s00168-010-0375-7.CrossRefGoogle Scholar
  7. Bourdieu, P. (1991). Language and symbolic power. Cambridge: Polity Press.Google Scholar
  8. Busenitz, L. W., & Lau, C. M. (1996). A cross-cultural cognitive model of new venture creation. Entrepreneurship Theory and Practice, 20(4), 25–39.Google Scholar
  9. Carree, M. A., & Thurik, A. R. (2008). The lag structure of the impact of business ownership on economic performance in OECD countries. Small Business Economics, 30(1), 101–110.Google Scholar
  10. Davidsson, P. (1995). Culture, structure and regional levels of entrepreneurship. Entrepreneurship and Regional Development, 7(1), 41–62.CrossRefGoogle Scholar
  11. Ester, P., Halman, L., & Seuren, B. (1994). Environmental concern and offering willingness in Europe and North America. In P. Ester, L. Halman, & R. de Moor (Eds.), The individualizing society: Value change in Europe and North America (pp. 163–181). Tilburg: Tilburg University Press.Google Scholar
  12. Etzioni, A. (1987). Entrepreneurship, adaptation and legitimation: A macro-behavioral perspective. Journal of Economic Behavior & Organization, 8(2), 175–189.CrossRefGoogle Scholar
  13. Fayolle, A., Basso, O., & Bouchard, V. (2010). Three levels of culture and firms’ entrepreneurial orientation: A research agenda. Entrepreneurship and Regional Development, 22(7–8), 707–730.CrossRefGoogle Scholar
  14. Fernández, J., Liñán, F., & Santos, F. J. (2009). Cognitive aspects of potential entrepreneurs in Southern and Northern Europe: an analysis using Gem-data. Revista de Economía Mundial, 23, 151–178.Google Scholar
  15. Fernández-Serrano, J., & Romero, I. (2013). Entrepreneurial quality and regional development: Characterizing SME sectors in low income areas. Papers in Regional Science, 92(3), 495–513. doi: 10.1111/j.1435-5957.2012.00421.x.
  16. Fishman, R., & Sarria-Allende, V. (2004). Regulation of entry and the distortion of industrial organization. Working paper no. 10929. Cambridge, MA: National Bureau of Economic Research.Google Scholar
  17. Fritsch, M., & Schroeter, A. (2011). Why does the effect of new business formation differ across regions? Small Business Economics, 36(4), 383–400. doi: 10.1007/s11187-009-9256-9.CrossRefGoogle Scholar
  18. Gries, T., & Naude, W. (2008). Entrepreneurship and structural economic transformation (working paper RP2008/62). Helsinki: UNU World Institute for Development Economics Research (UNU-WIDER).Google Scholar
  19. Hofstede, G. (1991). Cultures and organizations: Software of the mind. London: McGraw-Hill.Google Scholar
  20. Hofstede, G. (2003). Culture’s consequences: comparing values, behaviors, institutions and organizations across nations (2nd ed.). Newbury Park: Sage.Google Scholar
  21. Inglehart, R. (1997). Modernization and postmodernization. Princeton: Princeton University Press.Google Scholar
  22. Jabri, M. M. (2005). Commentaries and critical articles: Text-context relationships and their implications for cross cultural management. International Journal of Cross Cultural Management, 5(3), 349–360.CrossRefGoogle Scholar
  23. Jaén, I., & Liñán, F. (2013). Work values in a changing economic environment: the role of entrepreneurial capital. International Journal of Manpower, 34(8).Google Scholar
  24. Jovanovic, T. B. (1993). The diversification of production. Brookings Papers on Economic Activity, Microeconomics, 1993(1), 197–235.CrossRefGoogle Scholar
  25. Kelley, D. J., Singer, S., & Herrington, M. (2012). GEM 2011 global report. Global Entrepreneurshiop Research Association (GERA).Google Scholar
  26. Krueger, N. F. (2003). The cognitive psychology of entrepreneurship. In Z. J. Acs & D. B. Audretsch (Eds.), Handbook of entrepreneurship research: An interdisciplinary survey and introduction (pp. 105–140). London: Kluwer.Google Scholar
  27. Lee, S. Y., Florida, R., & Acs, Z. J. (2004). Creativity and entrepreneurship: A regional analysis of new firm formation. Regional Studies, 38(8), 879–891.CrossRefGoogle Scholar
  28. Lee, S. M., & Peterson, S. J. (2000). Culture, entrepreneurial orientation, and global competitiveness. Journal of World Business, 35(4), 401–416.CrossRefGoogle Scholar
  29. Li, Y., & Zahra, S. A. (2012). Formal institutions, culture, and venture capital activity: A cross-country analysis. Journal of Business Venturing, 27(1), 95–111. doi: 10.1016/j.jbusvent.2010.06.003.Google Scholar
  30. Liñán, F., Fernández, J., & Romero, I. (2013). Necessity and opportunity entrepreneurship: The mediating effect of culture. Revista de Economía Mundial, 33, 27–51.Google Scholar
  31. Liñán, F., Santos, F. J., & Fernández, J. (2011). The influence of perceptions on potential entrepreneurs. International Entrepreneurship and Management Journal, 7(3), 373–390.CrossRefGoogle Scholar
  32. Ma, J., & Todorovic, Z. W. (2012). Understanding the role of entrepreneurial quality and national culture on the economic development. International Journal of Entrepreneurship and Small Business, 16(3), 299–313. doi: 10.1504/IJESB.2012.047437.CrossRefGoogle Scholar
  33. Markus, H. R., & Kitayama, S. (1991). Culture and the self: Implications for cognition, emotion and motivation. Psychological Review, 98, 224–253.CrossRefGoogle Scholar
  34. Mcgrath, R. G., MacMillan, I. C., Yang, E. A., & Tsai, W. (1992). Does culture endure, or is it malleable? Issues for entrepreneurial economic development. Journal of Business Venturing, 7(6), 441–458.CrossRefGoogle Scholar
  35. Minkov, M., & Hofstede, G. (2012). Is national culture a meaningful concept? Cultural values delineate homogeneous national clusters of in-country regions. Cross-Cultural Research, 46(2), 133–159. doi: 10.1177/1069397111427262.CrossRefGoogle Scholar
  36. Minniti, M., Bygrave, W. D., & Autio, E. (2006). GEM, Global Entrepreneurship Monitor, 2005 executive report. London, UK, Babson Park, MA: London Business School, Babson College.Google Scholar
  37. Mueller, S. L., & Thomas, A. S. (2001). Culture and entrepreneurial potential: A nine country study of locus of control and innovativeness. Journal of Business Venturing, 16(1), 51–75.CrossRefGoogle Scholar
  38. Mueller, S. L., Thomas, A. S., & Jaeger, A. M. (2002). National entrepreneurial potential: the role of culture, economic development and political history. In M. A. Hitt & J. L. C. Cheng (Eds.), Managing transnational firms: Resources, market entry and strategic alliances (Vol. 14, pp. 221–257). Advances in international management. Amsterdam: JAI.CrossRefGoogle Scholar
  39. Noorderhaven, N., Thurik, R., Wennekers, A. R. M., & van Stel, A. (2004). The role of dissatisfaction and per capita income in explaining self-employment across 15 European countries. Entrepreneurship-Theory and Practice, 28(5), 447–466.CrossRefGoogle Scholar
  40. Parker, S. C., & Robson, M. (2004). Explaining international variations in self-employment: Evidence from a panel of OECD countries. Southern Economic Journal, 71(2), 287–301.CrossRefGoogle Scholar
  41. Pinillos, M. J., & Reyes, L. (2011). Relationship between individualist–collectivist culture and entrepreneurial activity: evidence from Global Entrepreneurship Monitor data. Small Business Economics, 37(1), 23–37. doi: 10.1007/s11187-009-9230-6.CrossRefGoogle Scholar
  42. Reynolds, P. D., Bygrave, W., Autio, E., & Hay, M. (2002). Global Entrepreneurship Monitor. 2002 summary report. Kansas City: Ewin Marion Kauffman Foundation.Google Scholar
  43. Reynolds, P. D., Storey, D. J., & Westhead, P. (1994). Cross-national comparison of the variation in new firm rates. Regional Studies, 28(4), 443–456.CrossRefGoogle Scholar
  44. Ros, M. (2002). Los valores culturales y el desarrollo socioeconómico: una comparación entre teorías culturales. Revista Española de Investigaciones Sociológicas, 99, 9–33.CrossRefGoogle Scholar
  45. Schwartz, S. H. (1992). Universals in the content and structure of values: Theoretical advances and empirical tests in 20 countries. In M. P. Zanna (Ed.), Advances in experimental social psychology (Vol. 25, pp. 1–65). New York: Academic.Google Scholar
  46. Schwartz, S. H. (1994). Beyond individualism–collectivism: New cultural dimensions of values. In U. Kim, H. C. Triandis, C. Kagitçibasi, S. C. Choi, & G. Yoon (Eds.), Individualism and collectivism. Theory, method, and applications (pp. 85–119). Thousand Oaks, CA: Sage.Google Scholar
  47. Schwartz, S. H. (1999). Cultural value differences: Some implications for work. Applied Psychology: An International Review, 48, 23–48.CrossRefGoogle Scholar
  48. Schwartz, S. H. (2004). Mapping and interpreting cultural differences around the world. In H. Vinken, J. Soeters, & P. Ester (Eds.), Comparing cultures, dimensions of culture in a comparative perspective. Leiden, The Netherlands: Brill.Google Scholar
  49. Schwartz, S. H. (2006a). Les valeurs de base de la personne: Théorie, mesures et applications. Revue Francaise De Sociologie, 47(4), 929–968.Google Scholar
  50. Schwartz, S. H. (2006b). A theory of cultural value orientations: Explication and applications. Comparative Sociology, 5(2–3), 137–182. doi: 10.1163/156913306778667357.CrossRefGoogle Scholar
  51. Schwartz, S. H. (2008). Cultural value orientations: Nature and implications of national differences. Moscow: SU HSE.Google Scholar
  52. Schwartz, S. H., Melech, G., Lehmann, A., Burgess, S., & Harris, M. (2001). Extending the cross-cultural validity of the theory of basic human values with a different method of measurement. Journal of Cross-Cultural Psychology, 32(5), 519–542.CrossRefGoogle Scholar
  53. Schwartz, S. H., & Ros, M. (1995). Values in the West: A theoretical and empirical challenge to the individualism–collectivism cultural dimension. World Psychology, 1, 99–122.Google Scholar
  54. Shane, S. (1993). Cultural influences on national rates of innovation. Journal of Business Venturing, 8(1), 59–73.CrossRefGoogle Scholar
  55. Stephan, U., & Uhlaner, L. (2010). Performance-based vs. socially-supportive culture: A cross-national study of descriptive norms and entrepreneurship. Journal of International Business Studies, 41(8), 1347–1364.Google Scholar
  56. Sternberg, R., & Wennekers, A. R. M. (2005). Determinants and effects of new business creation using global entrepreneurship monitor data. Small Business Economics, 24(3), 193–203.CrossRefGoogle Scholar
  57. Tang, L., & Koveos, P. E. (2008). A framework to update Hofstede’s cultural value indices: Economic dynamics and institutional stability. Journal of International Business Studies, 39(6), 1045–1063.CrossRefGoogle Scholar
  58. Thornton, P. H., Ribeiro-Soriano, D., & Urbano, D. (2011). Socio-cultural factors and entrepreneurial activity. International Small Business Journal, 29(2), 105–118. doi: 10.1177/0266242610391930.CrossRefGoogle Scholar
  59. Thurik, R., & Dejardin, M. (2011). Entrepreneurship and culture. In M. Van Gelderen & E. Masurel (Eds.), Entrepreneurship in context (pp. 175–186)., Routledge studies in entrepreneurship London: Routledge.Google Scholar
  60. van Stel, A., Carree, M., & Thurik, R. (2005). The effect of entrepreneurial activity on national economic growth. Small Business Economics, 24(3), 311–321. doi: 10.1007/s11187-005-1996-6.CrossRefGoogle Scholar
  61. van Stel, A., & Storey, D. J. (2004). The link between firm births and job creation: Is there a Upas tree effect? Regional Studies, 38(8), 893–909.CrossRefGoogle Scholar
  62. van Stel, A., Storey, D. J., & Thurik, A. R. (2007). The effect of business regulations on nascent and young business entrepreneurship. Small Business Economics, 28(2–3), 171–186.CrossRefGoogle Scholar
  63. van Stel, A., Wennekers, A. R. M., Thurik, A. R., & Reynolds, P. (2003). Explaining nascent entrepreneurship across countries. SCALES-paper N2003-01. Zoetermeer: EIM Business and Policy Research.Google Scholar
  64. Verheul, I., Wennekers, A. R. M., Audretsch, D. B., & Thurik, A. R. (2002). An eclectic theory of entrepreneurship. In D. B. Audretsch, A. R. Thurik, I. Verheul, & A. R. M. Wennekers (Eds.), Entrepreneurship: Determinants and Policy in a European–US comparison. Boston/Dordrecht: Kluwer.Google Scholar
  65. Weber, M. (1905). The protestant ethic and the spirit of capitalism. London, Boston: Unwin Hyman.Google Scholar
  66. Wennekers, A. R. M., Thurik, R., van Stel, A., & Noorderhaven, N. (2007). Uncertainty avoidance and the rate of business ownership across 21 OECD countries, 1976–2004. Journal of Evolutionary Economics, 17(2), 133–160.CrossRefGoogle Scholar
  67. Wennekers, A. R. M., Uhlaner, L. M., & Thurik, A. R. (2002). Entrepreneurship and its conditions: A macro perspective. International Journal of Entrepreneurship Education, 1(1), 25–64.Google Scholar
  68. Wennekers, A. R. M., van Stel, A., Thurik, A. R., & Reynolds, P. D. (2005). Nascent entrepreneurship and the level of economic development. Small Business Economics, 24(3), 293–309.CrossRefGoogle Scholar

Copyright information

© Springer Science+Business Media New York 2013

Authors and Affiliations

  1. 1.Department of Applied EconomicsUniversity of SevilleSevilleSpain

Personalised recommendations