ENTREPRENEURSHIP AND ECONOMIC PERFORMANCE: INTERNATIONAL EVIDENCE

The thesis investigates the effect of entrepreneurship on national economic growth as well as the individual-level and institutional determinants of entrepreneurial growth aspirations. The renewed focus on entrepreneurial firms in the early twenty-first century has resulted on an increased interest of both researcher and policymakers in the study of entrepreneurship. Although, in general, the previous empirical literature reports positive association between entrepreneurship and economic performance, the evidence is still not conclusive. Given the heterogeneity of results, methodological approaches and study characteristics, this thesis aims at shedding light on factors that influence this relationship. Using Meta-Regression Analysis (MRA), the appropriate statistical method and methodological approach to synthesise the existing entrepreneurship-economic performance literature, the thesis has provided relevant insights to the study of entrepreneurship. In addition to finding that there is a general tendency to report positive effects, the results indicate that there is also a positive genuine effect of entrepreneurship on country-level economic performance. Moreover, using the Global Entrepreneurship Monitor (GEM) data at country-level and a diversified modelling strategy, the thesis provides an original and comprehensive empirical investigation of the effect of entrepreneurship on economic growth. Benefiting from the work of Schumpeter (1934) and Baumol (1990; 1993), the focus of the thesis is on growth-oriented and innovative entrepreneurial activity (‘productive entrepreneurship’). A total of 48 developed and developing economies over the 2006-2014 period are included in the empirical analysis. The results indicate that growth aspiring and innovative entrepreneurial activities, rather than overall entrepreneurial activity, have a positive impact on short- and long-run national economic growth. The more developed economies compared to less developed economies, on average, are shown to benefit more from an increased growth-oriented entrepreneurial activity. Given the positive effect of growth aspirations on economic growth, the thesis then explores the factors influencing entrepreneurial growth aspirations in more detail. Using individual-level data from GEM and a set of quality of institutions variables in 55 countries, entrepreneurial growth aspirations for eighteen thousand young (new) entrepreneurial ventures are assessed. The hierarchical nature of the analysis requires the use of multilevel estimation modelling. The results indicate that individual-level attributes, including human, financial and social capital determine entrepreneurial growth aspirations. Also, the quality of institutions, including the protection of property rights, the level of corruption, the size of government activity and the existence of specifically designed programmes to support high-growth firms, determine growth aspirations. In addition, the interplay between individual and institutional variables moderates the effect of the latter on entrepreneurial growth aspirations. The empirical evidence generated throughout the thesis, provides useful policy implications for countries seeking to nurture more productive entrepreneurship and sustain long-run economic growth.