Global entrepreneurship in 2005

Entrepreneurs in middle income countries are beginning to catch-up to their counterparts in richer economies by tapping into technologies unavailable to them just a year ago, according to the seventh annual Global Entrepreneurship Monitor (GEM). The report is the largest annual measure of entrepreneurial activity, covering 35 countries.

Here is the media release and video clips covering the three new GEM reports. Jonathan Moules of the Financial Times reports that Middle income nations foster more start-ups:

Entrepreneurs in countries with middle per capita income are closing the gap on their counterparts in richer countries by tapping into technologies unavailable to them just a year ago, according to an international study of start-up activity.

The Global Entrepreneurship Monitor, the largest annual measure of start-up activity, found that higher percentages of people start businesses in middle income countries, such as Thailand and Brazil, than rich nations, such as Spain and Japan.

Venezuela, where a quarter of the population is involved in start-ups, had the highest level of early-stage entrepreneurial activity, followed by Thailand on 20.7 per cent and New Zealand at 17.6 per cent.

At the other end of the scale were Hungary and Japan, with just 1.9 per cent and 2.2 per cent of their respective populations involved in early-stage businesses.

Entrepreneurs from middle income countries also tend to create more innovative businesses with a higher growth potential on average than rich country start-ups, according to GEM, which is directed by Babson College in the US and London Business School.

However, entrepreneurs in high income countries are more likely to create businesses to meet a perceived opportunity, which are less likely to fail than the necessity-driven businesses, prevalent in middle income countries.

Pablo Halkyard at PSD blog.

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