Entrepreneurial Activity in

European Regions

Niels Bosma

From Business Growth to Economic Development

16 December 2016

Public University of Navarra &

Obra Social La Caixa – CAN Foundation

Outline

• Entrepreneurship in European Regions

• Drivers of Regional Differences in

Entrepreneurship

• Introducing Entrepreneurial Ecosystems: case

of the Netherlands

• Provisional (!) Diagnose Navarre Region

Entrepreneurship

in European Regions

Evidence from

Global Entrepreneurship Monitor Data

• World’s foremost study on entrepreneurship: seewww.gemconsortium.org and http://www.gem-spain.com/

• Primary data collection– Adult Population Survey: behaviour & attitudes

– National Expert Survey: context / ecosystem

• Since 1999; 17 years of comparable data across over 100 countries

• Involves over 300 academic and research institutions acrossthe globe

• Substantial coverage for European countries� Regional measures by merging several years’ data

� Next slides provide a first glance of the entrepreneurship differences across European regions

Global Entrepreneurship Monitor

“There are good opportunities to start a

business in the area where I live”

2007-2011 2012-2014

“Fear of failure would prevent me from starting

a business”

“Successful entrepreneurs receive high status”

Total early-stage Entrepreneurial Activity (TEA)

2007-2011 2012-2014

Total early-stage Entrepreneurial Activity (TEA)

Opportunity Motivation 2007-2014 Necessity Motivation 2007-2014

Recent News in NL: Thumbs up …

1

10

4

7

2

5

8

3

6

9

Economy Score1 Prev.2 Trend3

Switzerland 5.81 1

Singapore 5.72 2

United States 5.70 3

Netherlands 5.57 5

Germany 5.57 4

Sweden 5.53 9

United Kingdom 5.49 10

Japan 5.48 6

Hong Kong SAR 5.48 7

Finland 5.44 8

World Economic ForumGlobal Competitiveness Report 2016-2017

OECDEntrepreneurship at a Glance 2016

What do the data show?

0

100

200

300

400

500

600

700

800

900

Without personnel With personnel

0%

1%

2%

3%

4%

5%

6%

7%

8%

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Non-ambitious IEA Ambitious IEA

GEM Data: Independent early-stage

Entrepreneurial Activity (TEA)Dutch Self-Employment Statistics

Source: Liebregts, W. (2016) Institutional explanations for patterns of entrepreneurial activity:

The case of the Dutch task market. FIRES Working Paper D5.3

Ambitious early-stage Entrepreneurial Activity

TEA with high job-expectation (% of TEA) TEA with innovative orientation (% of TEA)

Drivers of Regional Differences in

Entrepreneurship

From: Stam, Erik & Bosma, Niels (2014). Growing Entrepreneurial Economies:

Entrepreneurship and Regional Development. In T. Baker & F. Welter (Eds.), The

Routledge Companion to Entrepreneurship, pp. 325-340. London: Routledge

Regional Conditions for

Entrepreneurship

• Compositional Factors

– Spatial distribution of (potential) entrepreneurs

• Personal characteristics such as age, education, household income (e.g. Bosma et al. 2009)

• Personality characteristics such as extraversion andopenness (e.g. Obschonka et al. 2015)

– Local inertia of entrepreneurs (Michelacci & Silva 2007; Figueiredo et al. 2002)

• Localised (strong) social ties

• Hybrid startup possibilities

• Local business network

Regional Conditions for

Entrepreneurship

• Contextual factors

– Entrepreneurship as a social (family) phenomenon

– Entrepreneurship as an organisational product

– Regional culture

– Nature and localisation of industries

• Clusters, localization econmies and related variety

– Urbanisation

– Regional formal institutions

– Regional knowledge production

– Regional access to financial capital

� Key: Interlinkages between these contextual factors!

Entrepreneurial Ecosystems

What’s Behind?

Entrepreneurial Ecosystem

• A set of interdependent actors and factors

coordinated in such a way that they enable

productive entrepreneurship within a

particular territory (Stam & Spigel 2016)

Knowledge Triangle

at the heart of the Entrepreneurial Ecosystem

I. Talent (human capital) = necessary input to

(knowledge based) entrepreneurship

II. Creation of knowledge based

entrepreneurial opportunities

III. Entrepreneurial action: Discovery and

exploitation of knowledge based

entrepreneurial opportunities (innovation)

Formal

institutions

Framework

conditions

Systemic

conditions

CulturePhysical

infrastructure

Aggregate Value CreationOutcomes

Outputs Entrepreneurial Activity

Networks

Leadership

Entrepreneurial Ecosystem & Knowledge Triangle

Interaction &

direction of

actorsFinance Talent Knowledge Regional Governance

Stam, E., Romme, A., Roso, M., Toren, J. v., & Starre, B. v. (2016). Knowledge Triangles in the Netherlands: An Entrepreneurial Ecosystem

Approach. Utrecht University | Eindhoven University Of Technology | Birch Consultants. Commissioned by the OECD, The Dutch Ministry

of Economic Affairs, The Dutch Ministry Of Education, Culture & Science, And The Dutch Centres Of Entrepreneurship

Stam, E. (2015). Entrepreneurial Ecosystems and Regional Policy: A Sympathetic Critique. European Planning Studies, 1759-1769.

20

Five Case Studies NL

Qualitative and quantitative:

• Metropolitan Region Amsterdam (MRA)

• Twente

• Brainport

Quantitative

• Utrecht

• South-Holland

Evidence from the study in NL regions

1. The least well developed Entrepreneurial

Ecosystems (EE) have no fully developed

Knowledge Triangle (Universities missing)

2. Involvement of regional business leaders in

regional governance is rare

3. Better developed Entrepreneurial Ecosystems

tend to have more diverse innovation

networks, not necessarily more dense

Implications for Productive

Entrepreneurship

• Can be enabled by (effective) leadership, but

also thrives without (Amsterdam, Utrecht)

• Interaction of education and knowledge

institutes without involvement of business

innovators = ineffective

• Independent Entrepreneurs &

Entrepreneurial Employees

Provisional ‘Diagnose’ Navarre Region

-2

-1

0

1

Perceived Opportunities

Perceived capabilities

Fear of failure

Startup intentions

Belief: entrepreneurship

good career choice

Belief: high status to

successful entrepreneurs

nascent entrepreneurshipOwner-managers in new

firms

Total early-stage

Entrepreneurial Activity…

Owner-managers in

established firms

TEA & expects at least five

employees

Innovative orientation (% of

TEA)

International orientation (%

of TEA)

Navarre Spain Average benchmark regions

Provisional ‘Diagnose’ Navarre Region

-2

-1

0

1

Perceived Opportunities

Perceived capabilities

Fear of failure

Startup intentions

Belief: entrepreneurship

good career choice

Belief: high status to

successful entrepreneurs

nascent entrepreneurshipOwner-managers in new

firms

Total early-stage

Entrepreneurial Activity…

Owner-managers in

established firms

TEA & expects at least five

employees

Innovative orientation (% of

TEA)

International orientation (%

of TEA)

Navarre Spain Average benchmark regions

What do we get out of this?

• Regional differences in entrepreneurship

• No such thing as ONE overall entrepreneurship indicator

• Cultural / institutional drivers at the base of the entrepreneurial ecosystem

• Importance of the knowledge triangle and the involvement of businesses in education

• GEM adult population survey indicators to be linked to Expert opinions– Use as input for group discussions; try to assess the interlinkages

• Determine an appropriate entrepreneurship policy– Acknowledging the cultural / institutional base

– Involving the relevant stakeholders

– Including the role role of entrepreneurial employees

Entrepreneurial Activity in

European Regions

Niels Bosma

From Business Growth to Economic Development

16 December 2016

Public University of Navarra &

Obra Social La Caixa – CAN Foundation