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Measuring Entrepreneurship: Do Established Metrics Capture Schumpeterian Entrepreneurship?

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  • Magnus Henrekson
  • Tino Sanandaji

Abstract

We compile four hand-collected measures of high-impact Schumpeterian entrepreneurship (venture capital-funded IPOs, self-made billionaire entrepreneurs, unicorn start-ups, and young top global firms founded by individual entrepreneurs) and six measures dominated by small business activity as well as institutional and economic variables for 64 countries. Factor analysis reveals that a great deal of the variation is accounted for by two distinct factors: one relating to high-impact Schumpeterian entrepreneurship and the other relating to small business activity. Except for the World Bank measure of firm registration of limited liability companies, quantity-based measures tend to be inappropriate proxies for high-impact Schumpeterian entrepreneurship.

Suggested Citation

  • Magnus Henrekson & Tino Sanandaji, 2020. "Measuring Entrepreneurship: Do Established Metrics Capture Schumpeterian Entrepreneurship?," Entrepreneurship Theory and Practice, , vol. 44(4), pages 733-760, July.
    • Handle: RePEc:sae:entthe:v:44:y:2020:i:4:p:733-760
    DOI: 10.1177/1042258719844500
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    3. Jörn H. Block & Christian Fisch & Walter Diegel, 2024. "Schumpeterian entrepreneurial digital identity and funding from venture capital firms," The Journal of Technology Transfer, Springer, vol. 49(1), pages 119-157, February.
    4. Pankaj C. Patel & Cornelius A. Rietveld, 2023. "Right of association and new business entry: country-level evidence from the market sector," Small Business Economics, Springer, vol. 61(3), pages 1161-1177, October.
    5. Mirella Schrijvers & Erik Stam & Niels Bosma, 2024. "Figuring it out: configurations of high-performing entrepreneurial ecosystems in Europe," Regional Studies, Taylor & Francis Journals, vol. 58(5), pages 1096-1110, May.
    6. Matthew J. Lindquist & Theodor Vladasel, 2022. "Are Entrepreneurs More Upwardly Mobile?," Working Papers 1351, Barcelona School of Economics.
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    10. de Grazia, Charles A.W. & Giczy, Alexander V. & Pairolero, Nicholas A., 2024. "Procrastination or incomplete data? An analysis of USPTO examiner search activity," Research Policy, Elsevier, vol. 53(7).
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