Understanding Entrepreneurship:

1
Understanding Entrepreneurship

• Developing Comparable Indicators on
  Entrepreneurship and Its Determinants

2
Development of the entrepreneurship indicator
programme (EIP)

• Internationally very little comparable data
  available, no commonly agreed indicators
• Mandate given to OECD to start the EIP
• Joint forces with the European Commission
• Infrastructure created (OECD steering group)

3
How to get to an indicator list

• Top-down approach
• Definition and deduction of indicators
• Bottom-up approach
• Pragmatic
• Approach the issue from both sides

4
The definition

• Entrepreneurs are those persons (business owners)
  who seek to generate value, through the creation
  or expansion of economic activity, by identifying
  and exploiting new products, processes or
  markets.
• Entrepreneurial activity is the enterprising
  human action in pursuit of the generation of
  value, through the creation or expansion of
  economic activity, by identifying and exploiting
  new products, processes or markets.
• Entrepreneurship is the phenomenon associated
  with entrepreneurial activity.

5
A Simple Model of the entrepreneurial process
Determinants
Impact
Entrepreneurial Performance
6
A Simple Model of the entrepreneurial process
Determinants
Impact
Job creation
Entrepreneurial Performance
Economic growth
Poverty reduction
Culture
others
7
A Simple Model of the entrepreneurial process
Determinants
Impact
Entrepreneurial Performance
8
Entrepreneurial Performance
Economic performance
Firms
Employer firm birth rate
Rate of high-growth firms concerning
turnover/profits
Employment
Employer firm death rate
Rate of turnover/profit Gazelles
Business churn
Rate of high-growth firms concerning employment
Value-added young firms
Net business population growth
Productivity contribution
Rate of employment Gazelles
Survival rate 3 years
Ownership rate start-ups
Productivity growth contribution
Survival rate 5 years
Ownership rate business population
Export share of 3 year old firms
Proportion 3 years survival
Employment rate 3 year old firms
Export share of 5 year old firms
Proportion 5 years survival
Employment rate 5 year old firms
Average firm size after 3 years
Average firm size after 5 years
adults starting firms
9
A Simple Model of the entrepreneurial process
Determinants
Impact
Entrepreneurial Performance
10
A Simple Model of the entrepreneurial process
Determinants
Impact
Access to finance
Entrepreneurial Performance
RD and technology
Entrepre neurial capabilities
Market conditions
Regulatory framework
Culture
11
Entrepreneurial Performance
Determinants
Impact
Market conditions
Access to finance
RD and technology
Entrepre neurial capabilities
Culture
Regulatory framework
Firms
Job creation
Employer firm birth rate
Employer firm death rate
Economic growth
Anti-trust laws
Access to debt financing
RD investment
Training and experience of entrepreneurs
Risk attitude in societies
Administrative burdens for entry
Business churn
Net business population growth
Survival rate 3 years
Competition
Poverty reduction
Survival rate 5 years
Business angels
University / industry interface
Attitudes towards entrepreneurs
Administrative burdens for growth
Proportion 3 years survival
Business and Entrepreneurship Education (skills)
Proportion 5 years survival
Access to the domestic market
Bankruptcy regulation
Employment
Culture
Access to VC
Technological cooperation between firms
Desire for business ownership
Entrepreneurship infrastructure
Rate of high-growth firms concerning employment
Access to foreign markets
Safety and health regulation
Access to other Types of Equity
Technology diffusion
Rate of employment Gazelles
Entrepreneurship Education (mindset)
Ownership rate start-ups
Immigration and E-ship
Degree of public involvement
Environment regulation
Ownership rate business population
Employment rate 3 year old firms
Broadband access
Stock markets
Employment rate 5 year old firms
Product regulation
Public procurement
Average firm size after 3 years
Average firm size after 5 years
Court-legal framework
adults starting firms
Patent system, standards
Economic performance
Labour market regulation
Rate of high-growth firms concerning
turnover/profits
Social and health security
Rate of turnover/profit Gazelles
Value-added young firms
Income taxes
Productivity contribution
Productivity growth contribution
Business taxes
Export share of 3 year old firms
Export share of 5 year old firms
Capital taxes
12
Birth rates EU aggregate 2005
13
compared with United States(US Census Bureau
data provided to OECD)
14
Finally

• www.entrepreneurship-indicators.net
• Thank you for your attention!
• Questions, comments?