Social progress orientation and innovative entrepreneurship: an international analysis

Abstract

Using the institutional approach, this paper examines the influence of social progress orientation on innovative entrepreneurship from an international perspective. Using a multiple linear regression model with cross-sectional information from the Global Entrepreneurship Monitor, the Indices of Social Development, the World Values Survey, the Hofstede Centre, the United Nations Development Programme and World Development Indicators, we find that social progress orientation dimensions such as voluntary spirit, survival vs. self-expression values and power distance were related to entrepreneurial activity. More specifically, the main findings demonstrate that high voluntary spirit had a positive and statistically significant impact on innovative early-stage entrepreneurial activity (TEA). In addition, necessity-driven TEA is highly discouraged in those societies with high voluntary spirit and self-expression values, whereas larger power distance increased the entrepreneurial activity driven by necessity. Based on these results, this study advances the literature by introducing and analyzing the concept of social progress orientation, by examining the factors that influence innovative entrepreneurial activity in light of an institutional approach. Also, this research could be useful for designing policies to foster entrepreneurial activity in different national and regional environments.

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Annex 1
Annex 2
Annex 3

Notes

  1. 1.

    According to the “Declaration on Social Progress and Development” by the United Nations (UN) General Assembly resolution 2542 (XXIV) of 11th December 1969.

  2. 2.

    GEM distinguishes between opportunity and necessity entrepreneurial activity (Amorós and Bosma 2014). Entrepreneurial activity driven by opportunity is characterized by the prevalence of improvement motivations (being independent and increasing income), whereas necessity is defined by survival motivations (no other job-paid options).

  3. 3.

    ISS of the Erasmus University Rotterdam to track globally the informal institutions that contribute to well-being.

  4. 4.

    Postmaterialist values are measured by the four-item index devised by Inglehart. In this index, respondents are asked to rank from one to four the four goals to which a country should aim in 10 years: (i) maintaining order in the nation, (ii) giving the people more say in important government decisions, (iii) fighting rising prices, and (iv) protecting freedom of speech. Items (i) and (iii) correspond to materialist values, while items (ii) and (iv) are postmaterialist values. The final ranks of the goals are used to assign respondents to one of three categories. If the first two rankings are postmaterialist values, respondents will be classified as Group 3. If the first two rankings are materialist values, respondents will be classified as Group 1. If one value is materialist and one postmaterialist, they will be classified as mixed in Group 2 (Braithwaite et al. 1996). Some authors criticize the four-item index due to the reductionist character of that measurement of postmaterialism (Davis and Davenport 1999). Others question the theoretical foundations of postmaterialism in itself; in that sense, Duch and Taylor (1993) found empirical evidence that early childhood economic condition is not sufficient to explain the emergence of postmaterialist values and that education and the current economic situation, such as crisis and inflation, are important. Despite the limitations and the lack of consensus among researchers, postmaterialism is one of the predominant conceptual frameworks in social science (Beckers et al. 2012).

  5. 5.

    According to Global Entrepreneurial activity Monitor (GEM), Scandinavian countries are reported systematically among the top rankers of entrepreneurial activity driven by opportunity, which is defined as the percentage of those involved in TEA who (i) claim to be driven by opportunity as opposed to finding no other option for work; and (ii) indicate that the main driver for being involved in this opportunity is being independent or increasing their income, rather than just maintaining their income. In 2012, the percentages were Finland 66%, Norway 61% and Sweden 58%.

  6. 6.

    After conducting an intra-firm worldwide research in IBM, Hofstede defined initially four cultural dimensions observed among respondents: Power Distance, Individualism vs. Collectivism, Masculinity vs. Femininity, Uncertainty Avoidance. Later on, in 1991, the addition of a fifth dimension, Long-Term Orientation, was based on a study about the presence of Chinese values among students from 23 countries (Minkov and Hofstede 2012).

  7. 7.

    Based on the GLOBE study (House et al. 2004).

  8. 8.

    Afrobarometer, Asian Barometer, Cingranelli-Richards (CIRI) Human Rights Data Project, Civicus, Cross-National Time-Series Data Archive, Demographic and Health Surveys, Economist Intelligence Unit, European Social Survey, Fund For Peace, John Hopkins Comparative Nonprofit Sector Project, International Country Risk Guide, International Crime Victims Survey, International Labour Organisation, International Social Survey, International Telecommunication Union, Latinobarometer, London School of Economics Annual Civil Society Yearbook, Minorities at Risk, OECD Factbook, UNESCO, Word Development Indicators, World Values Survey.

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Acknowledgments

The authors appreciate helpful comments by Professor Uwe Cantner and anonymous reviewers in the previous versions of this manuscript. In addition, David Urbano acknowledges the financial support from projects ECO2013-44027-P (Spanish Ministry of Economy & Competitiveness) and 2014-SGR-1626 (Economy & Knowledge Department —Catalan Government) and Sebastian Aparicio acknowledges funding for Ph.D. studies from COLCIENCIAS Ph.D. Programme chapter 3 (617/2013), Enlaza Mundos Municipio de Medellín (2013), and Fundación ECSIM for financial support.

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Urbano, D., Aparicio, S. & Querol, V. Social progress orientation and innovative entrepreneurship: an international analysis. J Evol Econ 26, 1033–1066 (2016). https://doi.org/10.1007/s00191-016-0485-1

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Keywords

  • Entrepreneurial activity
  • Social progress orientation
  • Institutions
  • Postmaterialism
  • Hofstede
  • Development

JEL Classification

  • I31
  • L26
  • O15