Abstract
The entrepreneurial capacity in an economy is a key determinant of economic growth and productivity improvements. This paper uses survey data from the 15 EU Member States and the US to investigate two aspects of entrepreneurial capacity: latent and actual entrepreneurship. Latent entrepreneurship is measured by the probability of a declared preference for self-employment over employment. Other than demographic variables such as gender, age and education level, the set of explanatory variables used includes country specific effects, the perception by respondents of administrative complexities and of availability of financial support and a rough measure of risk tolerance. The most striking result is the lack of explanatory power of the perception of lack of available financial support in the latent entrepreneurship equation.
Similar content being viewed by others
References
P. Arenius M. Minniti (2005) ArticleTitle‘Perceptual Variables and Nascent Entrepreneurship’ Small Business Economics 24 IssueID3 233–247 Occurrence Handle10.1007/s11187-005-1984-x
D. B. Audretsch A. R. Thurik I. Verheul S. Wennekers (Eds) (2002) Entrepreneurship: Determinants and Policy in a European-US Comparison Kluwer Academic Publishers Boston/Dordrecht
D. B. Audretsch M. A. Carree A. J. Stel Particlevan A. R. Thurik (2002) ArticleTitle‘Impeded Industrial Restructuring: the Growth Penalty’ Kyklos 55 IssueID1 81–97 Occurrence Handle10.1111/1467-6435.00178
D. B. Audretsch M. Fritsch (2002) ArticleTitle‘Growth Regimes over Time and Space’ Regional Studies 36 IssueID2 113–124 Occurrence Handle10.1080/00343400220121909
D. B. Audretsch A. R. Thurik (2001) ArticleTitle‘What is New about the New Economy: Sources of Growth in the Managed and Entrepreneurial Economies’ Industrial and Corporate Change 10 IssueID1 267–315 Occurrence Handle10.1093/icc/10.1.267
D. B. Audretsch A. R. Thurik (2004) ArticleTitle‘The Model of the Entrepreneurial Economy’ International Journal of Entrepreneurship Education 2 IssueID2 143–166
W. Baumol (1968) ArticleTitle‘Entrepreneurship in Economic Theory’ American Economic Review 58 IssueID2 81–106
D. G. Blachflower B. D. Meyer (1994) ArticleTitle‘A Longitudinal Analysis of the Young Self-Employed in Australia and the United States’ Small Business Economics 6 IssueID1 1–19 Occurrence Handle10.1007/BF01066108
D. G. Blanchflower A. J. Oswald (1998) ArticleTitle‘What Makes an Entrepreneur?’ Journal of Labor Economics 16 IssueID1 26–60 Occurrence Handle10.1086/209881
D. G. Blanchflower A. Oswald A. Stutzer (2001) ArticleTitle‘Latent Entrepreneurship Across Nations’ European Economic Review 45 IssueID4–6 680–691 Occurrence Handle10.1016/S0014-2921(01)00137-4
M. A. Carree A. R. Thurik (1999) Industrial Structure and Economic Growth D. B. Audretsch A. R. Thurik (Eds) Innovation, Industry Evolution and Employment Cambridge University Press Cambridge, UK 86–110
M. A. Carree A. R. Thurik (2003) The Impact of Entrepreneurship on Economic Growth D. B. Audretsch Z. J. Acs (Eds) Handbook of Entrepreneurship Research Kluwer Academic Publishers Boston/Dordrecht 437–471
Carree, M. A. and A. R. Thurik, 2006, The Handbook of Entrepreneurship and Economic Growth (international library of entrepreneurship) (Cheltenham, UK and Brookfield, US: Edward Elgar Publishing Limited), forthcoming
R. E. Caves (1998) ArticleTitle‘Industrial Organization and New Findings on the Turnover and Mobility of Firms’ Journal of Economic Literature 36 IssueID4 1947–1982
R. Cressy (1999) ArticleTitle‘The Evans and Jovanovic Equivalence Theorem and Credit Rationing: Another Look’ Small Business Economics 12 IssueID4 295–297 Occurrence Handle10.1023/A:1008064210706
E. J. Douglas D. A. Shepherd (2002) ArticleTitle‘Self-Employment as a Career Choice: Attitudes, Entrepreneurial Intentions, and Utility Maximization’ Entrepreneurship Theory and Practice 26 IssueID3 81–90
D. S. Evans B. Jovanovic (1989) ArticleTitle‘An Estimated Model of Entrepreneurial Choice under Liquidity Constraints’ Journal of Political Economy 97 IssueID4 808–827 Occurrence Handle10.1086/261629
D. S. Evans L. S. Leighton (1989) ArticleTitle‘Some Empirical Aspects of Entrepreneurship’ American Economic Review 79 IssueID3 519–535
D. S. Evans L. S. Leighton (1990) ArticleTitle‘Small Business Formation by Unemployed and Employed Workers’ Small Business Economics 2 IssueID4 319–330 Occurrence Handle10.1007/BF00401628
European Commission, 2001, ‘Attitudes to Entrepreneurship in Europe and United States – Some results from Flash Eurobarometer 83’, Brussels: Enterprise Directorate-General, http://europa.eu.int/comm/enterprise/enterprise_policy/survey/eurobarometer83.htm
European Commission, 2003, ‘Green paper: Entrepreneurship in Europe’, Brussels, Enterprise Directorate General, http://europa.eu.int/comm/enterprise/entrepreneurship/green_paper/index.htm
Grilo, I. M. and A. R. Thurik, 2005a, ‘Latent and Actual Entrepreneurship in Europe and the US’, International Entrepreneurship and Management Journal, 1(4), forthcoming
Grilo, I. M. and A. R. Thurik, 2005b, Determinants of Entrepreneurial Engagement Levels in Europe and the US, Papers on Entrepreneurship, Growth and Public Policy, Max Planck Institute of Economics, Jena, Germany, forthcoming
R. F. Hébert A. N. Link (1989) ArticleTitle‘In Search of the Meaning of Entrepreneurship’ Small Business Economics 1 IssueID1 39–49 Occurrence Handle10.1007/BF00389915
T. J. Holmes J. A. Schmitz SuffixJr. (1990) ArticleTitle‘A Theory of Entrepreneurship and its Application to the Study of Business Transfers’ Journal of Political Economy 98 IssueID2 265–294 Occurrence Handle10.1086/261678
B. Jovanovic (1982) ArticleTitle‘Selection and the Evolution of Industry’ Econometrica 50 IssueID3 649–670
B. Jovanovic (1994) ArticleTitle‘Firm Formation with Heterogeneous Management and Labor Skills’ Small Business Economics 6 IssueID3 185–191 Occurrence Handle10.1007/BF01108287
Z. Lin G. Picot J. Compton (2000) ArticleTitle‘The Entry and Exit Dynamics of Self-employment in Canada’ Small Business Economics 15 IssueID2 105–125 Occurrence Handle10.1023/A:1008150516764
R. Lucas (1978) ArticleTitle‘On the Size Distribution of Business Firms’ Bell Journal of Economics 9 IssueID2 508–523 Occurrence Handle10.2307/3003596
R. Kihlstrom J.-J. Laffont (1979) ArticleTitle‘A General Equilibrium Entrepreneurial Theory of the Firm Based on Risk Aversion’ Journal of Political Economy 87 IssueID4 719–748 Occurrence Handle10.1086/260790
Knight, F., 1921, Risk, Uncertainty, and Profit, The University of Chicago Press, 1971 originally published in 1921 by Houghton Mifflin Company
S. C. Parker (1997) ArticleTitle‘The Effects of Risk on Self-Employment’ Small Business Economics 9 IssueID6 515–522 Occurrence Handle10.1023/A:1007919805306
P. D. Reynolds (1997) ArticleTitle‘Who Starts New Firms? – Preliminary Explorations of Firms-in-Gestation’ Small Business Economics 9 IssueID5 449–462 Occurrence Handle10.1023/A:1007935726528
Reynolds, P. D., S. M. Camp, W. D. Bygrave, E. Autio and M. Hay, 2001, Global Entrepreneurship Monitor: 2001 Executive Report, available at http://www.gemconsortium.org
Stel, A. van, D. Storey, R. Thurik and S. Wennekers, 2005, From Nascent to Actual Entrepreneurship: The Effect of Entry Barriers, Papers on Entrepreneurship, Growth and Public Policy, Max Planck Institute of Economics, Jena, Germany, forthcoming
D. J. Storey (1991) ArticleTitle‘The Birth of New Firms – Does Unemployment Matter? A Review of the Evidence’ Small Business Economics 3 IssueID3 167–178 Occurrence Handle10.1007/BF00400022
D. J. Storey (2003) Entrepreneurship and Public Policies Z. J. Audretsch D. B. Acs (Eds) Handbook of Entrepreneurship Research Kluwer Academic Publishers Boston/Dordrecht 473–511
Verheul, I., 2005, Is There a (Fe)male Approach? Understanding Gender Differences in Entrepreneurship, Ph.D. thesis, Erasmus Institute for Management, EUR, Netherlands
S. R. M. Wennekers A. R. Thurik (1999) ArticleTitle‘Linking Entrepreneurship and Economic Growth’ Small Business Economics 13 IssueID1 27–55 Occurrence Handle10.1023/A:1008063200484
S. R. M. Wennekers L. Uhlaner A. R. Thurik (2002) ArticleTitle‘Entrepreneurship and its Conditions: A Macro Perspective’ International Journal of Entrepreneurship Education 1 IssueID1 25–64
Author information
Authors and Affiliations
Corresponding author
Rights and permissions
About this article
Cite this article
Grilo, I., Irigoyen, JM. Entrepreneurship in the EU: To Wish and not to be. Small Bus Econ 26, 305–318 (2006). https://doi.org/10.1007/s11187-005-1561-3
Accepted:
Issue Date:
DOI: https://doi.org/10.1007/s11187-005-1561-3
Keywords
- access to finance
- administrative complexities
- entrepreneurship
- probit regression
- risk attitudes
- self-employment