Entrepreneurship: A Global Perspective

Citation

Zebulen A. Riley (2015), "Entrepreneurship: A Global Perspective", Journal of Entrepreneurship and Public Policy, Vol. 4 No. 1, pp. 134-135. https://doi.org/10.1108/JEPP-06-2013-0023

Entrepreneurship exists everywhere, but takes different forms in different places because of the characteristics of individuals and the institutions particular to each place. While entrepreneurship is global in nature, it is certainly not homogenous, and in order to better understand its effects on economic activity, one must account for the heterogeneity of entrepreneurship across time and place. This is a central tenant of Entrepreneurship: A Global Perspective. In the book, a meta-analysis of much of the recent entrepreneurship literature, Stephen Roper (2013) describes enterprise in a global context, highlights the characteristics common among entrepreneurs, illustrates the decision calculus facing would-be entrepreneurs, and emphasizes the role of institutions in abetting or inhibiting entrepreneurial activity.

The book begins by defining entrepreneurship, its context, and the “global landscape of entrepreneurial activity.” In Chapter 2, Roper distinguishes between three types of enterprise: factor-driven, efficiency-driven, and innovation; he then suggests two impetuses for entrepreneurial activity: necessity and opportunity. Higher income countries typically have more innovation enterprise, whereas economic activity in low-income countries is comprised mainly of factor-driven entrepreneurship. While opportunity is the driving factor for the majority of enterprise in each of the three categories, necessity plays a bigger role, as expected, in factor-driven economies.

Chapter 3 compares and contrasts “enterprising nations” across the globe, particularly Belgium, Botswana, and Moldova, looking at economic data, demographics, and institutional measures of entrepreneurial-friendliness like ease of doing business. The institutional data are quite telling, with Belgium outperforming Botswana and Moldova for ease of doing business. Though, surprisingly, Moldova outranks the other two countries at enforcing contracts. Throughout the chapter, Roper discusses other data and offers several case studies to emphasize the globally heterogeneous nature of entrepreneurship.

The demographic and personal characteristics of entrepreneurs across time and place are largely the subject of Chapter 4. This chapter includes several interesting tables about entrepreneurial activity for different groups. For instance, entrepreneurship is highest among 25-34 year olds and 35-44 year olds in all groups of countries. The majority of female entrepreneurs are married. And in the USA, years of education has a statistically significant positive correlation with female entry into self-employment. The growing literature on the role of genetics makes a brief appearance in this chapter, with a citation of Nicolaou et al. (2008), who find that 37-42 percent of the variability in the probability of being an entrepreneur can be linked to genetic factors.

Chapters 5-7 take a more traditional look at running a business, including the rational choice theory of business startup, different measures and speeds of business growth, the role and availability of finance, and policies that affect business growth, all from a global perspective. For instance, Chapter 7 briefly examines Islamic finance and its role in entrepreneurial activity in the Middle East and other Islamic countries.

The role of small firms in innovation and job creation is discussed in Chapter 8. The next chapter focusses on underground and criminal entrepreneurship. Roper suggests that the activities of legal and criminal business ventures are often quite similar – both requiring opportunity recognition, resource gathering and coordination, and risk-taking. Enterprise policy is the subject of Chapter 10. The author describes the typical economic reason for intervention, “market failure.” Citing Bennett (2008), Roper argues that small firms play a vital role in an economy by creating jobs. That is, he says, entrepreneurship generates positive externalities. Another rationale for intervention is that government can develop a strategic plan or centrally direct the economy, which individual businesses cannot; the author offers renewable energy as an example.

Where neoclassical economics assumes away the role of the entrepreneur, Stephen Roper in Entrepreneurship goes inside the black box to shed light on the global entrepreneurial landscape, the decision calculus of the entrepreneur, and the role of institutions in fostering or inhibiting legitimate enterprise. According to the inside cover, this book is intended for final year undergraduate and postgraduate courses in enterprise, and for those students with strong international interests. While Entrepreneurship is a good primer on enterprise, it lacks the technical sophistication to be a primary resource for a higher-level undergraduate or graduate course, at least in economics. Making extensive use of much recent research this book does a superb job covering the basics of entrepreneurial activity. For a higher division undergraduate or graduate course, the book’s primary value is in its extensive coverage of the literature. The lack of technical sophistication, however, limits its use in graduate coursework in entrepreneurship to a reference text. While Entrepreneurship: A Global Perspective misses its target audience for the classroom setting, it is a valuable read for anyone interested in global entrepreneurship, formal and informal, and its references make a terrific starting place to base future research.