Designing Composite Entrepreneurship Indicators: An Application Using Consensus PCA

ENTREPRENEURSHIP AND ECONOMIC DEVELOPMENT: DESIGNING COMPOSITE ENTREPRENEURSHIP INDICATORS, Chapter 3, Wim Naudé, ed., Palgrave MacMillan, 2011

39 Pages Posted: 22 Jan 2012

See all articles by Diego Bernardo Avanzini

Diego Bernardo Avanzini

Central Bank of Chile; George Mason University School of Law

Date Written: June 20, 2009

Abstract

Existing indicators of entrepreneurial activity (such as the Global Entrepreneurship Monitor, Entrepreneurship Barometer, FORA’s Entrepreneurship Index, OECD and Economic Commission’s sets of indicators, among others) and several variables that have been considered good proxies for entrepreneurship during the last decades seem to be unsuitable to capture the complex relationship among economic, social, and demographic factors driving entrepreneurial activity.

In order to suggest a consistent methodology for measuring entrepreneurship, we review some of the most well-known theoretical dimensions of entrepreneurship and a selection of associated indicators is proposed. Indicators and measures are grouped under theoretical categories and a set of entrepreneurship indicators is constructed using multivariate statistical analysis (Consensus PCA based on NIPALS, with an extension of Probability PCA for dealing with missing values) for a panel of developed and developing countries.

Keywords: entrepreneurship, index, principal components analysis

JEL Classification: L26, M13, C82

Suggested Citation

Avanzini, Diego Bernardo, Designing Composite Entrepreneurship Indicators: An Application Using Consensus PCA (June 20, 2009). ENTREPRENEURSHIP AND ECONOMIC DEVELOPMENT: DESIGNING COMPOSITE ENTREPRENEURSHIP INDICATORS, Chapter 3, Wim Naudé, ed., Palgrave MacMillan, 2011, Available at SSRN: https://ssrn.com/abstract=1988954

Diego Bernardo Avanzini (Contact Author)

Central Bank of Chile ( email )

Agustinas 1180
Santiago
Chile
+56-2-670-2000 (Phone)

George Mason University School of Law ( email )

3301 Fairfax Drive
Arlington, VA 22201
United States
(703) 993-8000 (Phone)

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