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This paper is an introduction to the present special issue dedicated to scientific research using data collected as part of the Global Entrepreneurship Monitor (GEM) and considering new venture creation as the hall-mark of entrepreneurship. After a short description of GEM's theoretical and methodological background, this introduction highlights the main results of seven papers which were presented at the First GEM Research Conference in Berlin from 1 to 3 April 2004. First, there is empirical evidence that the role of entrepreneurial activity differs across the stages of economic development, in that there appears to be a U-shaped relationship between the level of development and the rate of entrepreneurship. Consequently, a positive effect of entrepreneurial activity on economic growth is found for highly developed countries but a negative effect for developing nations. Second, it is shown that different types of entrepreneurship may have a different impact on a nation's innovativeness and economic growth rate. In particular, potentially high-growth business startups and so-called opportunity entrepreneurship enhance knowledge spillovers and economic growth. Third, entrepreneurship is again shown to be a regional event that can only be understood if regional framework conditions, including networks and regional policies, are taken into consideration.

Based upon two strands of literature, this paper hypothesizes a U-shaped relationship between a country's rate of entrepreneurial dynamics and its level of economic development. This would imply a different scope for entrepreneurship policy across subsequent stages of development. Regressing global entrepreneurship (GEM) 2002 data for nascent entrepreneurship in 36 countries on the level of economic development as measured either by per capita income or by an index for innovative capacity, we find support for a U-shaped relationship. The results suggest that a 'natural rate' of nascent entrepreneurship is to some extent governed by 'laws' related to the level of economic development. For the most advanced nations, improving incentive structures for business start-ups and promoting the commercial exploitation of scientific findings offer the most promising approach for public policy. Developing nations, however, may be better off pursuing the exploitation of scale economies, fostering foreign direct investment and promoting management education.

Looks at the relationship between small business and entrepreneurship and also the differences between the two. Stresses that both are important separately and, in addition, notes where they overlap. Posits that in the early part of the last century small businesses were both vehicles for entrepreneurship and sources of employment and income but, although still important in the post-war years, large firms made great inroads in the 1960s and 1970s. Concludes that government's central role in entrepreneurialism for the economy is, by its very nature, enabling. Furthermore, entrepreneurship is acknowledged as a driver for economic growth, competitiveness and job creation.

In the 1980s stagflation and high unemployment caused a renewed interest in supply side economics and in factors determining economic growth. Simultaneously, the 1980s and 1990s have seen a reevaluation of the role of small firms and a renewed attention for entrepreneurship. The goal of this survey is to synthesize disparate strands of literature to link entrepreneurship to economic growth. This will be done by investigating the relationship between entrepreneurship and economic growth using elements of various fields: historical views on entrepreneurship, macro-economic growth theory, industrial economics (Porter's competitive advantage of nations), evolutionary economics, history of economic growth (rise and fall of nations) and the management literature on large corporate organizations. Understanding the role of entrepreneurship in the process of economic growth requires the decomposition of the concept of entrepreneurship. A first part of our synthesis is to contribute to the understanding of the dimensions involved, while paying attention to the level of analysis (individual, firm and aggregate level). A second part is to gain insight in the causal links between these entrepreneurial dimensions and economic growth. A third part is to make suggestions for future empirical research into the relationship between (dimensions of) entrepreneurship and economic growth.

In the present paper we address the relationship between business ownership and economic development. We will focus upon three issues. First, how is the equilibrium rate of business ownership related to the stage of economic development? Second, what is the speed of convergence towards the equilibrium rate when the rate of business ownership is out-of-equilibrium? Third, to what extent does deviating from the equilibrium rate of business ownership hamper economic growth? Hypotheses concerning all three issues are formulated in the framework of a new two-equation model. We find confirmation for the hypothesized economic growth penalty on deviations from the equilibrium rate of business ownership using a data panel of 23 OECD countries. An important policy implication of our exercises is that low barriers to entry and exit of businesses are necessary conditions for the equilibrium seeking mechanisms that are vital for a sound economic development.

Persistent differences in the level of business ownership across countries have attracted the attention of scientific as well as political debate. Cultural as well as economic influences are assumed to play a role. This paper deals with the influence of cultural attitudes towards uncertainty on the rate of business ownership across 21 OECD countries. First, the concepts of uncertainty and risk are elaborated, as well as their relevance for entrepreneurship. An occupational choice model is introduced to underpin our reasoning at the macro-level. Second, regression analysis using pooled macro data for 1976, 1990 and 2004 and controlling for several economic variables, yields evidence that uncertainty avoidance is positively correlated with the prevalence of business ownership. According to our model, a restrictive climate of large organizations in high uncertainty avoidance countries pushes individuals striving for autonomy towards self-employment. Regressions for these 3 years separately show that in 2004, this positive correlation is no longer found, indicating that a compensating pull of entrepreneurship in countries with low uncertainty avoidance may have gained momentum in recent years. Third, an interaction term between uncertainty avoidance and GDP per capita in the pooled panel regressions shows that the historical negative relationship between GDP per capita and the level of business ownership is substantially weaker for countries with lower uncertainty avoidance. This suggests that rising opportunity costs of self-employment play a less important role in this cultural environment, or are being compensated by increasing entrepreneurial opportunities. [PUBLICATION ABSTRACT]

We estimate an extended version of the three-equation model of Carree et al. (Small Bus Econ 19(3):271-290, 2002 ) where deviations from the 'equilibrium' rate of self-employment play a central role determining both the growth of self-employment and the rate of economic growth. In particular, we distinguish between solo self-employed and employer entrepreneurs, and allow for different 'equilibrium' relationships of these two types of independent entrepreneurship with the level of economic development. In addition, we also allow for different economic growth penalties of deviating from the 'equilibrium' rate for these two types. Using data for 26 OECD countries over the period 1992-2008, we find that the 'equilibrium' rate of solo self-employment seems to be independent of the level of economic development, whereas the 'equilibrium' rate of employer entrepreneurship is negatively related to economic development. Regarding the impact of deviating from the 'equilibrium' solo self-employment rate, we find that both positive and negative deviations diminish economic growth. For employer entrepreneurship we do not find such a growth penalty.

A survey is presented with the goal of synthesizing disparate strands of literature to link entrepreneurship to economic growth. This is done by investigating the relationship between entrepreneurship and economic growth using elements of various fields: historical views on entrepreneurship, macro-economic growth theory, industrial economics, evolutionary economics, history of economic growth, and the management literature on large corporate organizations. Understanding the role of entrepreneurship in the process of economic growth requires the decomposition of the concept of entrepreneurship. This is accomplished in 3 parts: 1. contributing to the understanding of the dimensions involved, while paying attention to the level of analysis, 2. gaining insight in the causal links between these entrepreneurial dimensions and economic growth, and 3. making suggestions for future empirical research into the relationship between entrepreneurship and economic growth.

This chapter aims to contribute to a structured overview of relevant dimensions and possible typologies, and to a selection of a smaller number of major entrepreneurship types that make specific economic and social contributions. It examines the entrepreneurial roles that are being fulfilled by these main types. Apart from two general roles that are played by (almost) all entrepreneurs, that is, risk bearing, and judgmental decision‐making about the allocation of scarce resources, the chapter discusses five roles that have a special relevance for specific types of entrepreneurship. The five roles are: exploration and creation; dynamic exploitation; static exploitation; enabling role of (mostly solo) entrepreneurs on behalf of client firms hiring them; and self‐employment as work opportunity for outsiders in the labor market. The chapter concerns the causal chains from these entrepreneurial roles to their final social and economic contributions, including the intermediate effects and linkages that are involved.