SBE Lect 5_ Part 2: ch7 Global entrepreneurship Monitor (NL vs. World…
SBE Lect 5_ Part 2: ch7 Global entrepreneurship Monitor
NL vs. World
“Nascents” = 7.58% says to be active as nascent entrepreneur in past year
“New businesses” = 5.84% owns & manages a business with income < 3.5 years
◦ Remember, this is the stock of 3.5 years!
“Intentions” = 23.42% is expecting to start a new business in the next three years
Nascents ~59% of TEA
◦ Overall, all statistics lower in NL (Note: High % Necessity entrepreneurship in low- income countries)
slide 6/26 failing and remaining nascent
see comments in L5 short
Are “nascents” economically relevant?
Should you worry as economist that so many nascents “fail”?
Whether people transition to young business ownership is explained by their interest (utility)
Only if this hampers productive entrepreneurship (“juridical reasons” / “rules of the game”)
There are certainly “dreamers” among the nascents: Some with intentions will never start
Quite many start (or take over a business) without having the intention to start for a long period of time
Still, many do transition from nascent entrepreneurship to young business ownership
◦ Can we identify those?
In countries in which “intentions” are high, “nascent entrepreneurship” also high
In some countries more socially acceptable to say you are nascent
Part of differences in TEA rates is explained by attitudes rather than actions
2. What actually triggers individuals to go
about starting a business?
Book mainly concerned with “Are nascents distinguishable from general population?”
◦ Nascent are more similar to actual entrepreneurs than to the general population
The usual socio-demographic differences (Lecture 7), but in particular:
Opportunity perception (+)
Confidence in own skills to run a business (+)
Knowing other entrepreneurs (+)
Fear of failure (-)
Therefore, economists lost interest in identifying nascents and rather focus on actual starters
Individual level factors
◦ What about the social embeddedness of entrepreneurship? see next part of the mind map