Advertisement

Small Business Economics

, Volume 53, Issue 3, pp 709–738 | Cite as

Capital is not enough: opportunity entrepreneurship and formal institutions

  • Christopher J. BoudreauxEmail author
  • Boris Nikolaev
Article

Abstract

We examine how economic institutions, measured by the Economic Freedom of the World (EFW) index, affect the relationship between capital—human, social, and financial—and opportunity-motivated entrepreneurship (OME). To do this, we develop a multi-level model that connects theories of human and social capital at the micro-level to institutional theories at the macro-level. Using data from the Global Entrepreneurship Monitor (GEM), we then test the predictions of our model and find evidence that economic institutions play a crucial role in the relationship between these three distinct types of capital and OME. Our results are somewhat counter-intuitive—as the quality of the institutional environment improves, human and financial capitals become less important determinants of entrepreneurship while the relationship between social capital and entrepreneurship substantially strengthens.

Keywords

Economic freedom Entrepreneurship Financial capital Human capital Institutions Social capital 

Abbreviations

OME

Opportunity-motivated entrepreneurship

GEM

Global Entrepreneurship Monitor

TEA

Total early-stage entrepreneurial activity

Institutions

Economic freedom (Fraser Institute)

Human capital

College education

Financial capital

Household income

Social capital

Ties with other entrepreneurs

JEL classification

E22 J24 L14 L26 M13 

References

  1. Acemoglu, D., Johnson, S., & Robinson, J. A. (2001). The colonial origins of comparative development: an empirical analysis. American Economic Review, 91(5), 1369–1401.  https://doi.org/10.1257/aer.91.5.1369.Google Scholar
  2. Acs, Z. (2006). How is entrepreneurship good for economic growth? Innovations, 1(1), 97–107.  https://doi.org/10.1162/itgg.2006.1.1.97.Google Scholar
  3. Acs, Z., & Szerb, L. (2007). Entrepreneurship, economic growth and public policy. Small Business Economics, 28(2–3), 109–122.  https://doi.org/10.1007/s11187-006-9012-3.Google Scholar
  4. Acs, Z., Desai, S., & Hessels, J. (2008). Entrepreneurship, economic development and institutions. Small Business Economics, 31(3), 219–234.  https://doi.org/10.1007/s11187-008-9135-9.Google Scholar
  5. Adelino, M., Schoar, A., & Severino, F. (2015). House prices, collateral, and self-employment. Journal of Financial Economics, 117(2), 288–306.  https://doi.org/10.1016/j.jfineco.2015.03.005.Google Scholar
  6. Adler, P. S., & Kwon, S.-W. (2002). Social capital: prospects for a new concept. Academy of Management Review, 27(1), 17–40.  https://doi.org/10.5465/AMR.2002.5922314.Google Scholar
  7. Aidis, R., Estrin, S., & Mickiewicz, T. (2008). Institutions and entrepreneurship development in Russia: a comparative perspective. Journal of Business Venturing, 23(6), 656–672.  https://doi.org/10.1016/j.jbusvent.2008.01.005.Google Scholar
  8. Alvarez, S. A., & Barney, J. B. (2007). Discovery and creation: alternative theories of entrepreneurial action. Strategic Entrepreneurship Journal, 1(1–2), 11–26.  https://doi.org/10.1002/sej.4.Google Scholar
  9. Audretsch, D., & Keilbach, M. (2004). Entrepreneurship capital and economic performance. Regional Studies, 38(8), 949–959.  https://doi.org/10.1080/0034340042000280956.Google Scholar
  10. Autio, E., & Acs, Z. (2010). Intellectual property protection and the formation of entrepreneurial growth aspirations. Strategic Entrepreneurship Journal, 4(3), 234–251.  https://doi.org/10.1002/sej.93.Google Scholar
  11. Autio, E., Pathak, S., & Wennberg, K. (2013). Consequences of cultural practices for entrepreneurial behaviors. Journal of International Business Studies, 44(4), 334–362.  https://doi.org/10.1057/jibs.2013.15.Google Scholar
  12. Baron, R. (2015). Social capital. In Wiley encyclopedia of management (pp. 1–3). American Cancer Society.  https://doi.org/10.1002/9781118785317.weom030086.
  13. Bates, T. (1990). Entrepreneur human capital inputs and small business longevity. The Review of Economics and Statistics, 72(4), 551–559.  https://doi.org/10.2307/2109594.Google Scholar
  14. Batjargal, B. (2003). Social capital and entrepreneurial performance in Russia: a longitudinal study. Organization Studies, 24(4), 535–556.  https://doi.org/10.1177/0170840603024004002.Google Scholar
  15. Baumol, W. J. (1990). Entrepreneurship: productive, unproductive, and destructive. Journal of Political Economy, 98(5, Part 1), 893–921.  https://doi.org/10.1086/261712.Google Scholar
  16. Baumol, W. J. (1996). Entrepreneurship: productive, unproductive, and destructive. Journal of Business Venturing, 11(1), 3–22.  https://doi.org/10.1016/0883-9026(94)00014-X.Google Scholar
  17. Bennett, D. L., & Nikolaev, B. (2016). Factor endowments, the rule of law and structural inequality. Journal of Institutional Economics, 12(4), 773–795.  https://doi.org/10.1017/S1744137416000084.Google Scholar
  18. Bjørnskov, C., & Foss, N. J. (2008). Economic freedom and entrepreneurial activity: some cross-country evidence. Public Choice, 3(134), 307–328.  https://doi.org/10.1007/s11127-007-9229-y.Google Scholar
  19. Bjørnskov, C., & Foss, N. (2013). How strategic entrepreneurship and the institutional context drive economic growth. Strategic Entrepreneurship Journal, 7(1), 50–69.  https://doi.org/10.1002/sej.1148.Google Scholar
  20. Bjørnskov, C., & Foss, N. J. (2016). Institutions, entrepreneurship, and economic growth: what do we know and what do we still need to know? The Academy of Management Perspectives, 30(3), 292–315.  https://doi.org/10.5465/amp.2015.0135.Google Scholar
  21. Black, J., de Meza, D., & Jeffreys, D. (1996). House price, the supply of collateral and the enterprise economy. Economic Journal, 106(434), 60–75.  https://doi.org/10.2307/2234931.Google Scholar
  22. Blanchflower, D. G. (2004). Self-employment: more may not be better (working paper no. 10286). National Bureau of Economic Research. Retrieved from http://www.nber.org/papers/w10286.
  23. Blanchflower, D. G., & Oswald, A. J. (1998). What makes an entrepreneur? Journal of Labor Economics, 16(1), 26–60.  https://doi.org/10.1086/209881.Google Scholar
  24. Block, J. H., & Wagner, M. (2010). Necessity and opportunity entrepreneurs in Germany: characteristics and earning s differentials. Schmalenbach Business Review, 62(2), 154–174.Google Scholar
  25. Block, J., Sandner, P., & Spiegel, F. (2015). How do risk attitudes differ within the group of entrepreneurs? The role of motivation and procedural utility. Journal of Small Business Management, 53(1), 183–206.  https://doi.org/10.1111/jsbm.12060.Google Scholar
  26. Bosma, N., van Praag, M., Thurik, R., & Wit, G. d. (2004). The value of human and social capital investments for the business performance of startups. Small Business Economics, 23(3), 227–236.  https://doi.org/10.1023/B:SBEJ.0000032032.21192.72.Google Scholar
  27. Boudreaux, C. J. (2014). Jumping off of the Great Gatsby curve: how institutions facilitate entrepreneurship and intergenerational mobility. Journal of Institutional Economics, 10(2), 231–255.  https://doi.org/10.1017/S1744137414000034.Google Scholar
  28. Boudreaux, C. J. (2017). Institutional quality and innovation: some cross-country evidence. Journal of Entrepreneurship and Public Policy, 6(1), 26–40.  https://doi.org/10.1108/JEPP-04-2016-0015.Google Scholar
  29. Boudreaux, C. J., Nikolaev, B., & Klein, P. (2017). Entrepreneurial traits, institutions, and the motivation to engage in entrepreneurship. Academy of Management Proceedings, 2017(1), 16427.  https://doi.org/10.5465/AMBPP.2017.33.Google Scholar
  30. Boudreaux, C. J., Nikolaev, B., & Holcombe, R. (2018). Corruption and destructive entrepreneurship. Small Business Economics, 51(1), 181–202.  https://doi.org/10.1007/s11187-017-9927-x.Google Scholar
  31. Bradley, S. W., & Klein, P. (2016). Institutions, economic freedom, and entrepreneurship: the contribution of management scholarship. The Academy of Management Perspectives, 30(3), 211–221.  https://doi.org/10.5465/amp.2013.0137.Google Scholar
  32. Brewer, J., & Gibson, S. W. (2014). Necessity entrepreneurs: microenterprise education and economic development. Cheltenham: Edward Elgar Publishing.Google Scholar
  33. Bricker, J., Henriques, A., Krimmel, J., & Sabelhaus, J. (2016). Measuring income and wealth at the top using administrative and survey data. Brookings Papers on Economic Activity, 2016(1), 261–331.  https://doi.org/10.1353/eca.2016.0016.Google Scholar
  34. Brown, S., Farrell, L., & Harris, M. N. (2011). Modeling the incidence of self-employment: individual and employment type heterogeneity. Contemporary Economic Policy, 29(4), 605–619.  https://doi.org/10.1111/j.1465-7287.2010.00232.x.Google Scholar
  35. Bylund, P. L., & McCaffrey, M. (2017). A theory of entrepreneurship and institutional uncertainty. Journal of Business Venturing, 32(5), 461–475.  https://doi.org/10.1016/j.jbusvent.2017.05.006.Google Scholar
  36. Cassar, A., & Wydick, B. (2010). Does social capital matter? Evidence from a five-country group lending experiment. Oxford Economic Papers, 62(4), 715–739.  https://doi.org/10.1093/oep/gpq010.Google Scholar
  37. Cassar, A., Crowley, L., & Wydick, B. (2007). The effect of social capital on group loan repayment: evidence from field experiments. The Economic Journal, 117(517), F85–F106.  https://doi.org/10.1111/j.1468-0297.2007.02016.x.Google Scholar
  38. Christakis, N. A., & Fowler, J. H. (2009). Connected: The surprising power of our social networks and how they shape our lives. Little, Brown and Company, Boston.Google Scholar
  39. Cohen, D., Prusak, L., & Prusak, L. (2001). In good company: how social capital makes organizations work (Vol. 15). Boston: Harvard Business School Press.Google Scholar
  40. Coleman, J. S. (1988). Social capital in the creation of human capital. American Journal of Sociology, 94, S95–S120.  https://doi.org/10.1086/228943.Google Scholar
  41. Cooke, P., & Wills, D. (1999). Small firms, social capital and the enhancement of business performance through innovation programmes. Small Business Economics, 13(3), 219–234.  https://doi.org/10.1023/A:1008178808631.Google Scholar
  42. Cooper, A. C., Gimeno-Gascon, F. J., & Woo, C. Y. (1994). Initial human and financial capital as predictors of new venture performance. Journal of Business Venturing, 9(5), 371–395.  https://doi.org/10.1016/0883-9026(94)90013-2.Google Scholar
  43. Cope, J., Jack, S., & Rose, M. B. (2007). Social capital and entrepreneurship: an introduction. International Small Business Journal, 25(3), 213–219.  https://doi.org/10.1177/0266242607076523.Google Scholar
  44. Davidsson, P. (1991). Continued entrepreneurship: ability, need, and opportunity as determinants of small firm growth. Journal of Business Venturing, 6(6), 405–429.  https://doi.org/10.1016/0883-9026(91)90028-C.Google Scholar
  45. Davidsson, P., & Honig, B. (2003). The role of social and human capital among nascent entrepreneurs. Journal of Business Venturing, 18(3), 301–331.  https://doi.org/10.1016/S0883-9026(02)00097-6.Google Scholar
  46. De Clercq, D., Lim, D., & Oh, C. (2013). Individual-level resources and new business activity: the contingent role of institutional context. Entrepreneurship Theory and Practice, 37(2), 303–330.  https://doi.org/10.1111/j.1540-6520.2011.00470.x.Google Scholar
  47. De Soto, H. (2000). The mystery of capital: why capitalism triumphs in the west and fails everywhere else. New York: Basic Books.Google Scholar
  48. Djankov, S., La Porta, R., Lopez-de-Silanes, F., & Shleifer, A. (2002). The regulation of entry. The Quarterly Journal of Economics, 117(1), 1–37.  https://doi.org/10.1162/003355302753399436.Google Scholar
  49. Du, J., & Mickiewicz, T. (2016). Subsidies, rent seeking and performance: being young, small or private in China. Journal of Business Venturing, 31(1), 22–38.  https://doi.org/10.1016/j.jbusvent.2015.09.001.Google Scholar
  50. Estrin, S., Korosteleva, J., & Mickiewicz, T. (2013). Which institutions encourage entrepreneurial growth aspirations? Journal of Business Venturing, 28(4), 564–580.  https://doi.org/10.1016/j.jbusvent.2012.05.001.Google Scholar
  51. Evans, D. S., & Jovanovic, B. (1989). An estimated model of entrepreneurial choice under liquidity constraints. Journal of Political Economy, 97(4), 808–827.  https://doi.org/10.1086/261629.Google Scholar
  52. Fairlie, R. W., & Krashinsky, H. A. (2012). Liquidity constraints, household wealth, and entrepreneurship revisited. Review of Income and Wealth, 58(2), 279–306.  https://doi.org/10.1111/j.1475-4991.2011.00491.x.Google Scholar
  53. Fairlie, R. W., & Robb, A. M. (2009). Gender differences in business performance: evidence from the Characteristics of Business Owners survey. Small Business Economics, 33(4), 375.  https://doi.org/10.1007/s11187-009-9207-5.Google Scholar
  54. Festinger, L. (1954). A theory of social comparison processes. Human Relations, 7(2), 117–140.  https://doi.org/10.1177/001872675400700202.Google Scholar
  55. Fukuyama, F. (1995). Trust: the social virtues and the creation of prosperity. New York: Free Press Paperbacks.Google Scholar
  56. Fukuyama, F. (2001). Social capital, civil society and development. Third World Quarterly, 22(1), 7–20.  https://doi.org/10.1080/713701144.Google Scholar
  57. Ge, J., Stanley, L. J., Eddleston, K., & Kellermanns, F. W. (2017). Institutional deterioration and entrepreneurial investment: the role of political connections. Journal of Business Venturing, 32(4), 405–419.  https://doi.org/10.1016/j.jbusvent.2017.04.002.Google Scholar
  58. GEM. (2016). GEM. Retrieved November 3, 2016, from http://www.gemconsortium.org.
  59. Gohmann, S. F. (2012). Institutions, latent entrepreneurship, and self-employment: an international comparison. Entrepreneurship Theory and Practice, 36(2), 295–321.  https://doi.org/10.1111/j.1540-6520.2010.00406.x.Google Scholar
  60. Gohmann, S. F., Hobbs, B. K., & McCrickard, M. (2008). Economic freedom and service industry growth in the United States. Entrepreneurship Theory and Practice, 32(5), 855–874.  https://doi.org/10.1111/j.1540-6520.2008.00259.x.Google Scholar
  61. Goltz, S., Buche, M. W., & Pathak, S. (2015). Political empowerment, rule of law, and women’s entry into entrepreneurship. Journal of Small Business Management, 53(3), 605–626.  https://doi.org/10.1111/jsbm.12177.Google Scholar
  62. Gorodnichenko, Y., & Roland, G. (2011). Individualism, innovation, and long-run growth. Proceedings of the National Academy of Sciences, 108(Supplement 4), 21316–21319.  https://doi.org/10.1073/pnas.1101933108.Google Scholar
  63. Granovetter, M. (1973). The strength of weak ties. American Journal of Sociology, 78(6), 1360–1380.  https://doi.org/10.1086/225469.Google Scholar
  64. Granovetter, M. (1983). The strength of weak ties: a network theory revisited. Sociological Theory, 1, 201–233.  https://doi.org/10.2307/202051.Google Scholar
  65. Gwartney, J., Lawson, R. A., & Holcombe, R. G. (1999). Economic freedom and the environment for economic growth. Journal of Institutional and Theoretical Economics (JITE)/Zeitschrift Für Die Gesamte Staatswissenschaft, 155(4), 643–663.  https://doi.org/10.2307/40752161.Google Scholar
  66. Gwartney, J., Lawson, R., & Hall, J. (2016). Economic freedom of the world 2016 annual report. The Fraser Institute.Google Scholar
  67. Hall, J. C., & Lawson, R. A. (2014). Economic freedom of the world: an accounting of the literature. Contemporary Economic Policy, 32(1), 1–19.  https://doi.org/10.1111/coep.12010.Google Scholar
  68. Hayek, F. A. (1945). The use of knowledge in society. The American Economic Review, 35(4), 519–530.Google Scholar
  69. Henley, A. (2005). Job creation by the self-employed: the roles of entrepreneurial and financial capital. Small Business Economics, 25(2), 175–196.  https://doi.org/10.1007/s11187-004-6480-1.Google Scholar
  70. Herrera-Echeverri, H., Haar, J., & Estévez-Bretón, J. B. (2014). Foreign direct investment, institutional quality, economic freedom and entrepreneurship in emerging markets. Journal of Business Research, 67(9), 1921–1932.  https://doi.org/10.1016/j.jbusres.2013.11.020.Google Scholar
  71. Hessels, J., van Gelderen, M., & Thurik, R. (2008). Entrepreneurial aspirations, motivations, and their drivers. Small Business Economics, 31(3), 323–339.  https://doi.org/10.1007/s11187-008-9134-x.Google Scholar
  72. Hofmann, D. A., Griffin, M. A., & Gavin, M. B. (2000). The application of hierarchical linear modeling to organizational research. In K. J. Klein & S. W. J. Kozlowski (Eds.), Multilevel theory, research, and methods in organizations: foundations, extensions, and new directions (pp. 467–511). San Francisco: Jossey-Bass.Google Scholar
  73. Hofstede, G. H., & Hofstede, G. (2001). Culture’s consequences: comparing values, behaviors, institutions and organizations across nations. Sage.Google Scholar
  74. Holcombe, R. G., & Boudreaux, C. J. (2015). Regulation and corruption. Public Choice, 164(1–2), 75–85.  https://doi.org/10.1007/s11127-015-0263-x.Google Scholar
  75. Holtz-Eakin, D., Joulfaian, D., & Rosen, H. (1994). Entrepreneurial decisions and liquidity constraints. RAND Journal of Economics, 25, 334–347.  https://doi.org/10.1086/261921.Google Scholar
  76. Hurst, E., & Lusardi, A. (2004). Liquidity constraints, household wealth, and entrepreneurship. Journal of Political Economy, 112(2), 319–347.  https://doi.org/10.1086/381478.Google Scholar
  77. Kim, P. H., & Aldrich, H. E. (2005). Social capital and entrepreneurship. Foundations and Trends® in Entrepreneurship. 1(2), 55–104.  https://doi.org/10.1561/0300000002.
  78. King, R. G., & Levine, R. (1993). Finance, entrepreneurship and growth. Journal of Monetary Economics, 32(3), 513–542.  https://doi.org/10.1016/0304-3932(93)90028-E.Google Scholar
  79. Kirzner, I. M. (1973). Competition and entrepreneurship (New edition edition). Chicago: University Of Chicago Press.Google Scholar
  80. Kreft, S. F., & Sobel, R. S. (2005). Public policy, entrepreneurship, and economic freedom. Cato Journal, 25, 595.Google Scholar
  81. La Porta, R., Lopez-de-Silanes, F., & Shleifer, A. (2008). The economic consequences of legal origins. Journal of economic literature, 46(2), 285–332.  https://doi.org/10.1257/jel.46.2.285.
  82. La Porta, R., Lopez-De-Silanes, F., Shleifer, A., & Vishny, R. W. (1997). Legal determinants of external finance. The Journal of Finance, 52(3), 1131–1150.  https://doi.org/10.1111/j.1540-6261.1997.tb02727.x.Google Scholar
  83. La Porta, R., Lopez-de-Silanes, F., Shleifer, A., & Vishny, R. (2000). Investor protection and corporate governance. Journal of Financial Economics, 58(1–2), 3–27.  https://doi.org/10.1016/S0304-405X(00)00065-9.Google Scholar
  84. Light, I., & Dana, L.-P. (2013). Boundaries of social capital in entrepreneurship. Entrepreneurship Theory and Practice, 37(3), 603–624.  https://doi.org/10.1111/etap.12016.Google Scholar
  85. Lindh, T., & Ohlsson, H. (1996). Self-employment and windfall gains: evidence from the Swedish lottery. Economic Journal, 106(439), 1515–1526.  https://doi.org/10.2307/2235198.Google Scholar
  86. Margolis, D. N. (2014). By choice and by necessity: entrepreneurship and self-employment in the developing world. The European Journal of Development Research, 26(4), 419–436.  https://doi.org/10.1057/ejdr.2014.25.Google Scholar
  87. Marshall, M. G., & Jaggers, K. (2002). Polity IV project: Political regime characteristics and transitions, 1800–2002.Google Scholar
  88. Martin, B. C., McNally, J. J., & Kay, M. J. (2013). Examining the formation of human capital in entrepreneurship: a meta-analysis of entrepreneurship education outcomes. Journal of Business Venturing, 28(2), 211–224.  https://doi.org/10.1016/j.jbusvent.2012.03.002.Google Scholar
  89. Matlay, H., & Westhead, P. (2005). Virtual teams and the rise of e-entrepreneurship in Europe. International Small Business Journal, 23(3), 279–302.  https://doi.org/10.1177/0266242605052074.Google Scholar
  90. McMullen, J. S., Bagby, D. R., & Palich, L. E. (2008). Economic freedom and the motivation to engage in entrepreneurial action. Entrepreneurship Theory and Practice, 32(5), 875–895.  https://doi.org/10.1111/j.1540-6520.2008.00260.x.Google Scholar
  91. Minniti, M. (2008). The role of government policy on entrepreneurial activity: productive, unproductive, or destructive? Entrepreneurship Theory and Practice, 32(5), 779–790.  https://doi.org/10.1111/j.1540-6520.2008.00255.x.Google Scholar
  92. Minniti, M., & Lévesque, M. (2010). Entrepreneurial types and economic growth. Journal of Business Venturing, 25(3), 305–314.  https://doi.org/10.1016/j.jbusvent.2008.10.002.Google Scholar
  93. Misangyi, V. F., Weaver, G. R., & Elms, H. (2008). Ending corruption: the interplay among institutional logics, resources, and institutional entrepreneurs. Academy of Management Review, 33(3), 750–770.  https://doi.org/10.5465/amr.2008.32465769.Google Scholar
  94. Murphy, K. M., Shleifer, A., & Vishny, R. W. (1991). The allocation of talent: implications for growth. The Quarterly Journal of Economics, 106(2), 503–530.  https://doi.org/10.2307/2937945.Google Scholar
  95. Nahapiet, J., & Ghoshal, S. (1998). Social capital, intellectual capital, and the organizational advantage. Academy of Management Review, 23(2), 242–266.  https://doi.org/10.5465/AMR.1998.533225.Google Scholar
  96. Nejad, M. N., & Young, A. T. (2016). Want freedom, will travel: emigrant self-selection according to institutional quality. European Journal of Political Economy, 45(Supplement), 71–84.  https://doi.org/10.1016/j.ejpoleco.2016.06.002.Google Scholar
  97. Nikolaev, B., & Bennett, D. L. (2016). Give me liberty and give me control: economic freedom, control perceptions and the paradox of choice. European Journal of Political Economy.  https://doi.org/10.1016/j.ejpoleco.2015.12.002.
  98. Nikolaev, B., & Salahodjaev, R. (2017). Historical prevalence of infectious diseases, cultural values, and the origins of economic institutions. Kyklos, 70(1), 97–128.  https://doi.org/10.1111/kykl.12132.Google Scholar
  99. Nikolaev, B., & Wood, M. (2017). Cascading ripples: contagion effects of entrepreneurial activity on self-employment attitudes and choices in regional cohorts. Strategic Entrepreneurship Journal.  https://doi.org/10.1002/sej.1286.
  100. Nikolaev, B., Hall, J. C., Pulito, J. M., & VanMetre, B. J. (2013). The effect of personal and economic freedom on entrepreneurial activity: evidence from a new state level freedom index. American Journal of Entrepreneurship, VI(1), 88–103.Google Scholar
  101. Nikolaev, B., Boudreaux, C. J., & Palich, L. E. (2018). Cross-country determinants of early stage necessity and opportunity-motivated entrepreneurship: accounting for model uncertainty. Journal of Small Business Management.  https://doi.org/10.1111/jsbm.12400.
  102. North, D. C. (1990). Institutions, institutional change and economic performance. Cambridge: Cambridge University Press.Google Scholar
  103. Nyström, K. (2008). The institutions of economic freedom and entrepreneurship: evidence from panel data. Public Choice, 136(3–4), 269–282.  https://doi.org/10.1007/s11127-008-9295-9.Google Scholar
  104. Pacheco, D. F., York, J. G., Dean, T. J., & Sarasvathy, S. D. (2010). The coevolution of institutional entrepreneurship: a tale of two theories. Journal of Management, 36(4), 974–1010.  https://doi.org/10.1177/0149206309360280.Google Scholar
  105. Parker, S. C. (2004). The economics of self-employment and entrepreneurship. Cambridge: Cambridge University Press.Google Scholar
  106. Pathak, S., Xavier-Oliveira, E., & Laplume, A. O. (2013). Influence of intellectual property, foreign investment, and technological adoption on technology entrepreneurship. 66(10), 2090–2101.  https://doi.org/10.1016/j.jbusres.2013.02.035.
  107. Peterson, M. F., Arregle, J.-L., & Martin, X. (2012). Multilevel models in international business research. Journal of International Business Studies, 43(5), 451–457.  https://doi.org/10.1057/jibs.2011.59.Google Scholar
  108. Powell, B., & Weber, R. (2013). Economic freedom and entrepreneurship: a panel study of the United States. American Journal of Entrepreneurship, 6(1), 67–88.Google Scholar
  109. Putnam, R. D. (1995). Bowling alone: America’s declining social capital. Journal of Democracy, 6(1), 65–78.  https://doi.org/10.1353/jod.1995.0002.Google Scholar
  110. Putnam, R. D., Leonardi, R., & Nanetti, R. Y. (1994). Making democracy work: civic traditions in modern Italy. Princeton: Princeton University Press.Google Scholar
  111. Qian, J., & Strahan, P. E. (2007). How laws and institutions shape financial contracts: the case of bank loans. The Journal of Finance, 62(6), 2803–2834.  https://doi.org/10.1111/j.1540-6261.2007.01293.x.Google Scholar
  112. Qin, F., & Estrin, S. (2015). Does social influence span time and space? Evidence from Indian returnee entrepreneurs. Strategic Entrepreneurship Journal, 9(3), 226–242.  https://doi.org/10.1002/sej.1202.
  113. Raudenbush, S. W. (1988). Educational applications of hierarchical linear models: a review. Journal of Educational Statistics, 13(2), 85–116.  https://doi.org/10.3102/10769986013002085.Google Scholar
  114. Rees, H., & Shah, A. (1986). An empirical analysis of self-employment in the UK. Journal of Applied Econometrics, 1(1), 95–108.  https://doi.org/10.1002/jae.3950010107.Google Scholar
  115. Reynolds, P., Bosma, N., Autio, E., Hunt, S., Bono, N. D., Servais, I., et al. (2005). Global entrepreneurship monitor: data collection design and implementation 1998–2003. Small Business Economics, 24(3), 205–231.  https://doi.org/10.1007/s11187-005-1980-1.Google Scholar
  116. Rodrik, D. (2008). Second-best institutions (working paper no. 14050). National Bureau of Economic Research.  https://doi.org/10.3386/w14050.
  117. Ruef, M. (2002). Strong ties, weak ties and islands: structural and cultural predictors of organizational innovation. Industrial and Corporate Change, 11(3), 427–449.  https://doi.org/10.1093/icc/11.3.427.Google Scholar
  118. Ruef, M. (2010). The entrepreneurial group: social identities, relations, and collective action. Princeton: Princeton University Press.Google Scholar
  119. Saez, E., & Zucman, G. (2016). Wealth inequality in the United States since 1913: evidence from capitalized income tax data. The Quarterly Journal of Economics, 131(2), 519–578.  https://doi.org/10.1093/qje/qjw004.Google Scholar
  120. Schumpeter, J. A. (1934). The theory of economic development: an inquiry into profits, capital, credit, interest, and the business cycle. Transaction Publishers.Google Scholar
  121. Schwartz, S. H. (1999). A theory of cultural values and some implications for work. Applied Psychology, 48(1), 23–47.  https://doi.org/10.1111/j.1464-0597.1999.tb00047.x.Google Scholar
  122. Schwartz, S. H. (2006). A theory of cultural value orientations: explication and applications. Comparative Sociology, 5(2), 137–182.  https://doi.org/10.1163/156913306778667357.Google Scholar
  123. Shane, S. (2000). Prior knowledge and the discovery of entrepreneurial opportunities. Organization Science, 11(4), 448–469.  https://doi.org/10.1287/orsc.11.4.448.14602.Google Scholar
  124. Shane, S. (2008). The illusions of entrepreneurship: the costly myths that entrepreneurs, investors, and policy makers live by. Yale University Press.Google Scholar
  125. Shepherd, D. A. (2011). Multilevel entrepreneurship research: opportunities for studying entrepreneurial decision making. Journal of Management, 37(2), 412–420.  https://doi.org/10.1177/0149206310369940.Google Scholar
  126. Simoes, N., Crespo, N., & Moreira, S. B. (2016). Individual determinants of self-employment entry: what do we really know? Journal of Economic Surveys, 30(4), 783–806.  https://doi.org/10.1111/joes.12111.Google Scholar
  127. Simón-Moya, V., Revuelto-Taboada, L., & Guerrero, R. F. (2014). Institutional and economic drivers of entrepreneurship: an international perspective. Journal of Business Research, 67(5), 715–721.  https://doi.org/10.1016/j.jbusres.2013.11.033.Google Scholar
  128. Snijders, T., & Bosker, R. (2004). Multilevel analysis. London: SAGE.Google Scholar
  129. Sobel, R. S. (2008). Testing Baumol: institutional quality and the productivity of entrepreneurship. Journal of Business Venturing, 23(6), 641–655.  https://doi.org/10.1016/j.jbusvent.2008.01.004.Google Scholar
  130. Sobel, R. S., & Hall, J. C. (2008). Institutions, entrepreneurship, and regional differences in economic growth. American Journal of Entrepreneurship, I(1), 69–96.Google Scholar
  131. Sobel, R. S., Clark, J. R., & Lee, D. R. (2007). Freedom, barriers to entry, entrepreneurship, and economic progress. The Review of Austrian Economics, 20(4), 221–236.  https://doi.org/10.1007/s11138-007-0023-3.Google Scholar
  132. Stuart, T., & Sorenson, O. (2003). The geography of opportunity: spatial heterogeneity in founding rates and the performance of biotechnology firms. Research Policy, 32(2), 229–253.  https://doi.org/10.1016/S0048-7333(02)00098-7.Google Scholar
  133. Su, J., Zhai, Q., & Karlsson, T. (2016). Beyond red tape and fools: institutional theory in entrepreneurship research, 1992–2014. Entrepreneurship Theory and Practice.  https://doi.org/10.1111/etap.12218.
  134. Tsai, W. (2001). Knowledge transfer in intraorganizational networks: effects of network position and absorptive capacity on business unit innovation and performance. Academy of Management Journal, 44(5), 996–1004.  https://doi.org/10.2307/3069443.Google Scholar
  135. Tsai, W., & Ghoshal, S. (1998). Social capital and value creation: the role of Intrafirm networks. Academy of Management Journal, 41(4), 464–476.  https://doi.org/10.2307/257085.Google Scholar
  136. Van Bastelaer, T. (2002). Does social capital facilitate the poor’s access to credit? In T. Van Bastelaer & C. Grootaert (Eds.), Understanding and measuring social capital: a multidisciplinary tool for practitioners. Directions in development (pp. 237–264). Washington, DC: World Bank Retrieved from http://hdl.handle.net/10986/14098.Google Scholar
  137. Van Der Sluis, J., Van Praag, M., & Vijverberg, W. (2008). Education and entrepreneurship selection and performance: a review of the empirical literature. Journal of Economic Surveys, 22(5), 795–841.  https://doi.org/10.1111/j.1467-6419.2008.00550.x.Google Scholar
  138. von Greiff, J. (2009). Displacement and self-employment entry. Labour Economics, 16(5), 556–565.  https://doi.org/10.1016/j.labeco.2009.02.005.Google Scholar
  139. Wennberg, K., Pathak, S., & Autio, E. (2013). How culture moulds the effects of self-efficacy and fear of failure on entrepreneurship. Entrepreneurship and Regional Development, 25(9–10), 756–780.  https://doi.org/10.1080/08985626.2013.862975.Google Scholar
  140. Wennekers, S., van Wennekers, A., Thurik, R., & Reynolds, P. (2005). Nascent entrepreneurship and the level of economic development. Small Business Economics, 24(3), 293–309.  https://doi.org/10.1007/s11187-005-1994-8.Google Scholar
  141. Westlund, H., & Bolton, R. (2003). Local social capital and entrepreneurship. Small Business Economics, 21(2), 77–113.  https://doi.org/10.1023/A:1025024009072.Google Scholar
  142. Williamson, O. E. (1979). Transaction-cost economics: the governance of contractual relations. The Journal of Law and Economics, 22(2), 233–261.  https://doi.org/10.1086/466942.Google Scholar
  143. Williamson, O. E. (2000). The new institutional economics: taking stock, looking ahead. Journal of Economic Literature, 38(3), 595–613.  https://doi.org/10.1257/jel.38.3.595.Google Scholar
  144. Xavier-Oliveira, E., Laplume, A. O., & Pathak, S. (2015). What motivates entrepreneurial entry under economic inequality? The role of human and financial capital. Human Relations, 68(7), 1183–1207.  https://doi.org/10.1177/0018726715578200.Google Scholar
  145. Young, S. L., Welter, C., & Conger, M. (2017). Stability vs. flexibility: the effect of regulatory institutions on opportunity type. Journal of International Business Studies.  https://doi.org/10.1057/s41267-017-0095-7.

Copyright information

© Springer Science+Business Media, LLC, part of Springer Nature 2018

Authors and Affiliations

  1. 1.Department of EconomicsFlorida Atlantic UniversityBoca RatonUSA
  2. 2.Department of EntrepreneurshipBaylor UniversityWacoUSA

Personalised recommendations