Indicators of entrepreneurship activity: some methodological contributions

Abstract

Using a model-based approach, this paper reexamines the measurement of entrepreneurial activity at the national level. Our contribution centres on two main aspects. First, our study allows for the measurement of the likelihood of entrepreneurial behaviour, or entrepreneurial propensity. Second, utilising the social network theory, we introduce the social entrepreneurial environment as a key indicator of the likelihood of entrepreneurial activity. Using the data provided by the Global Entrepreneurship Monitor (GEM) project, we provide an alternative measure of entrepreneurial activity, which includes entrepreneurial social environment, assumes the existence of a continuum in entrepreneurial behaviour and provides a measure of entrepreneurial propensity. Results indicate that our model provides support for the combined use of entrepreneurial propensity and the entrepreneur's social context.