The Diversity of Entrepreneurial Regimes in Europe

Abstract

Although institutional reforms are necessary to increase rates of entrepreneurship in European countries, we argue that one-size-fits-all reform strategies are unlikely to be successful. Reform strategies must be informed by a better knowledge of the varieties of European capitalism and the institutional complementarities that drive these differences. We investigate these issues by gathering a number of potentially relevant entrepreneurial regime measurements as well as indicators of formal and informal institutions based on data available from the 2000s onward. We employ principal component analysis, factor analysis and cluster analysis to examine how 21 European countries and the United States cluster in the entrepreneurial and institutional dimensions. Our results reveal six country clusters, or entrepreneurial regimes, with a distinct bundle of entrepreneurial characteristics and institutional attributes. The main implication is that different reform strategies are appropriate to promote entrepreneurship and economic growth in European countries in different clusters.

Institutional Reform for Innovation and Entrepreneurship

“…In a recent contribution, Dilli and Elert (2016) undertake an analysis with a scope similar to that of Amable (2003) but in which the main focus is on understanding the complementarities and features of the institutional structures underlying entrepreneurial regimes. They do a stepwise aggregation of data in an analysis covering 22 countries (19 EU-28 countries together with Norway, Switzerland and 9 Typically, losses are also more salient and weigh more heavily on utility than gains (Kahneman and Tversky 1979), which in and of itself breeds resistance to change.…”

Innovation, Entrepreneurship and the Complementary Skill Structure

“…In a recent contribution, Dilli and Elert (2016) undertake an analysis with a scope similar to that of Amable (2003) but in which the main focus is on understanding the complementarities and features of the institutional structures underlying entrepreneurial regimes. They do a stepwise aggregation of data in an analysis covering 22 countries (19 EU-28 countries together with Norway, Switzerland and 9 Typically, losses are also more salient and weigh more heavily on utility than gains (Kahneman and Tversky 1979), which in and of itself breeds resistance to change.…”