New Entrepreneurship Ranking of Countries | US Not the Most Entrepreneurial

In the past 5 years while working on my PhD part-time at GMU, I have been fortunate to work with some incredible professors from various fields — economics, sociology, political science, history, and higher education. Two of them, Richard Florida and Zoltan Acs, have made incredible contributions in the fields of economic development, entrepreneurship, innovation, creativity, and technology policy.

Acs, who is my dissertation adviser, has been working with Laszlo Szerb in developing a new index for understanding entrepreneurship globally: the Global Entrepreneurship and Development Index.

The Christian Science Monitor covers the recent release of the US data on the GEDI. Past measures, including new firm formation, self-employment rates, the Global Entrepreneurship Monitor’s (GEM) Total Early-phase Entrepreneurial Activity index, the Index of Economic Freedom, and others have pushed the field forward, but have not always been useful in policy making and/or economic analysis.

The new index attempts to capture the ‘contextual features of entrepreneurship.’  The framework covers a broad range of variables and importantly attempts to include qualitative differences, rather than just the traditional quantitative variables used.  Further, the GEDI includes individual variables, not just institutional variables.

From the CSMonitor:

The U.S. lands third in a report from the U.S. Small Business Administration’s Office of Advocacy, which evaluated 71 nations in terms of entrepreneurship and performance.

“The global perception of the country as a land of opportunity and as the mecca for individuals wanting to do something new and different seems to be somewhat challenged by the facts,” wrote the report’s authors, Zoltan Acs of George Mason University in Fairfax, Va., and Laslo Szerb of Hungary’s University of Pécs.

Those facts, according to their report: Stacked against other major economies, the U.S. lacks high-growth business and cultural support for entrepreneurship and is frail in the technology sector.

The weaknesses caused the United States to rank an unlikely sixth in entrepreneurial attitudes — society’s feelings toward entrepreneurship, based on education and social stability — and eighth in entrepreneurial activity: what citizens are doing to improve the quality of human resources and technological efficiency.

“However, it seems that in many respects a slowdown in U.S. entrepreneurial activities may be a reflection of progress by the rest of the world — learning from the U.S. model and beginning to catch up,” Acs and Szerb wrote in the report, titled “Global Entrepreneurship and the United States” and released Sept. 9.

You can download a pdf of the SBA report, Global Entrepreneurship and the United States.

Best country for entrepreneurs? Hint: Not the US. – CSMonitor.com.

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