Superentrepreneurship and Global Imbalances: Closing Europe's Gap to Other Industrialized Regions

33 Pages Posted: 2 Dec 2014 Last revised: 15 Aug 2015

Magnus Henrekson

Research Institute of Industrial Economics (IFN)

Tino Sanandaji

Research Institute of Industrial Economics (IFN)

Date Written: August 3, 2015

Abstract

The overwhelming majority of self-employed individuals are not entrepreneurial in the Schumpeterian sense. To unmistakably identify Schumpeterian entrepreneurs, we focus on self-made billionaires (in USD) from the Forbes Magazine list who became wealthy by founding new firms. In this way, we identify 996 billionaire entrepreneurs in over fifty countries during the 1996-2010 period. Interestingly, the rate of billionaire entrepreneurs per capita correlates negatively with self-employment rates. Countries with higher incomes, higher trust, lower taxes, more venture capital investment and lower regulatory burdens have higher entrepreneurship rates but less self-employment. Europe has a higher self-employment rate than the United States and East Asia. At the same time, Europe has a lower entrepreneurship rate than competitor regions. Europe underperforms in entrepreneurship despite having advantages such as a skilled labour force, good infrastructure, large markets and strong performance in technological innovation.

Keywords: Entrepreneurship, Innovation, Institutions, Regulation, Self-employment

JEL Classification: L5, M13, O31, P14

Suggested Citation

Henrekson, Magnus and Sanandaji, Tino, Superentrepreneurship and Global Imbalances: Closing Europe's Gap to Other Industrialized Regions (August 3, 2015). IFN Working Paper No. 1049. Available at SSRN: https://ssrn.com/abstract=2532881

Magnus Henrekson (Contact Author)

Research Institute of Industrial Economics (IFN) ( email )

P.O. Box 55665
Grevgatan 34
Stockholm, SE-10215
Sweden
+46-8-6654502 (Phone)
+46-8-6654599 (Fax)

HOME PAGE: http://www.ifn.se/mh

Tino Sanandaji

Research Institute of Industrial Economics (IFN) ( email )

Box 55665
Grevgatan 34, 2nd floor
Stockholm, SE-102 15
Sweden
0723230694 (Phone)

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