Policies to promote entrepreneurial activity and economic performance

Abstract

Purpose

The purpose of this paper is to analyse the effects of some political measures on entrepreneurship to promote economic growth and employment, specifically, R & D policies, training, elimination of administrative barriers, access to finance support and promotion of entrepreneurial culture.

Design/methodology/approach

Seven hypotheses are tested developing a latent variables model with data from 13 European countries (Austria, Belgium, Denmark, Finland, France, Germany, Ireland, Italy, the Netherlands, Portugal, Spain, Sweden and UK) in 2012, using partial least squares estimation method.

Findings

Greater expenditure on R & D by governments and universities, public investment in education and measures to stimulate entrepreneurial culture have a positive effect on entrepreneurship. Furthermore, countries with complex legal systems which regulate the start-up of an economic activity and where access to credit is complicated, present lower levels of entrepreneurship. Societies with a greater number of innovative entrepreneurs present higher levels of entrepreneurial activity and economic performance. Finally, human capital and entrepreneurial activity positively affect economic performance in the case of the European countries studied in the sample.

Practical implications

The results obtained in the paper would facilitate the design of measures to stimulate to entrepreneurs and improve economic performance.

Originality/value

Several factors, qualitative and quantitative, have been considered in the analysis that they have not traditionally included in the analysis of the entrepreneurship behaviour taking into account the role played by the policy makers measures to improve such behaviour.

Citation

Castaño-Martínez, M.-S., Méndez-Picazo, M.-T. and Galindo-Martín, M.-Á. (2015), "Policies to promote entrepreneurial activity and economic performance", Management Decision, Vol. 53 No. 9, pp. 2073-2087. https://doi.org/10.1108/MD-06-2014-0393