Do country level constructs affect the relation between self-efficacy and fear of failure?

2020 ◽  
Vol 12 (4) ◽  
pp. 545-568 ◽  
Author(s):  
Sana' Kamal ◽  
Yousef S. Daoud
Keyword(s):  
Economic Development ◽  
Self Efficacy ◽  
Legal Protection ◽  
Fear Of Failure ◽  
Entrepreneurial Activity ◽  
Content Type ◽  
Investment Protection ◽  
Country Level ◽  
The Impact ◽  
Gem Data

Purpose This paper aims to show how country level constructs (investment protection, registration cost and legal protection) moderate the relationship between self-efficacy and fear of failure (FoF). Design/methodology/approach The authors use global entrepreneurship monitor (GEM) data and augment it with country level data for 12 counties from different levels of economic development. The entrepreneurship literature has not yet addressed the micro/macro level influences on FoF to the best of the authors’ knowledge. This paper addresses this lacuna by using multilevel analysis by incorporating state influenced environment effects along with individual traits to explain this phenomenon. Findings It is shown that higher registration cost, higher degrees of investor protection and less legal protection diminish the effect of self-efficacy on FoF. Furthermore, the effects of the country-level factors outweigh the impact of the individual-level factors on FoF. Research limitations/implications One of the issues discussed earlier was the construct validity of FoF, the wording of the question in GEM data is phrased such that FoF prevents you from starting a business; this means the response is avoidance. Had the question been worded positively, the responses may have varied. A better measure would have been an index with a scale the shows varying degrees of FoF. Another feature of GEM data is that the cohorts change every year, making it impossible to track the effect of closing a business on perceptual variables such as FoF and skill perception. This requires further scrutiny and analysis. Practical implications It is noticed that there are regional differences in FoF country rates across various levels of economic development. The authors provide and explain by looking at how these constructs moderate the relation between skill perception and FoF. Thus, countries that have good investment protection may end up with better entrepreneurial activity rates due to mitigating the fear factor. Social implications Entrepreneurial activity rates can be increased by lowering the negative effect of FoF. This construct is known to be higher among females, which was typically thought to be an individual trait. This research also shows that legal and institutional constructs are actually more important in explaining FoF. Originality/value The contribution of this paper is that it addresses an acknowledged gap in the literature, in that it explains empirical findings that have not been explained before (at the level this paper does).

Can policy makers count with positive impact of entrepreneurship on economic development of the Czech regions?

2017 ◽  
Vol 9 (3) ◽  
pp. 286-299 ◽  
Author(s):  
Ondřej Dvouletý
Keyword(s):  
Economic Development ◽  
Fixed Effects ◽  
Positive Impact ◽  
Negative Relationship ◽  
Policy Implications ◽  
Entrepreneurial Activity ◽  
Gdp Per Capita ◽  
Content Type ◽  
Per Capita ◽  
The Impact

Purpose The purpose of the present study is to empirically investigate the impact of the newly established entrepreneurial activity on economic development of the Czech NUTS 3 regions during the period of years 2003-2015. Design/methodology/approach An econometric approach was used to validate the stated hypotheses assuming a positive relationship between the new entrepreneurial activity and regional economic growth and a negative relationship between the new entrepreneurial activity and unemployment rate. For the methods, regression models with fixed effects were estimated on the panel that included 13 Czech regions, covering the period of years 2003-2015. The new entrepreneurial activity was classified into two forms – rate of newly established self-employed set-ups per capita and rate of newly established business companies and partnership set-ups per capita. Findings Different impacts of newly established business companies and the self-employed were found on real gross domestic product (GDP) per capita. Only the higher rates of newly established business companies and partnership were associated with higher levels of GDP per capita in the Czech regions, and no impact was found for the rate of new self-employed set-ups. Nevertheless, both forms of newly established entrepreneurial activity were associated with lower unemployment rates in the Czech regions; however, the impact of newly established business companies was significantly higher. The obtained results have several policy implications, which are discussed in the present paper. Practical implications Support of entrepreneurship in the Czech regions may improve the situation on the local labour markets and may deliver new job opportunities through the newly established enterprises. The Czech entrepreneurship policies focused on the growth of GDP and economic boom should be oriented more on the support of high-growth enterprises (unicorns). Originality/value The empirical analysis was conducted on the basis of the research gap in the studies related to the impact of the newly established entrepreneurial activity on the economic development of the Czech regions. Obtained results have several policy implications, which are discussed in the present paper.

Shareholder protection, creditor rights and bank dividend policies

2015 ◽  
Vol 5 (2) ◽  
pp. 161-186 ◽  
Author(s):  
Badar Nadeem Ashraf ◽  
Changjun Zheng
Keyword(s):  
Regression Models ◽  
Legal Protection ◽  
Creditor Rights ◽  
Dividend Payout ◽  
Content Type ◽  
Shareholder Protection ◽  
Dividend Policies ◽  
Country Level ◽  
The Impact ◽  
Nonfinancial Firms

Purpose – The purpose of this paper is to examine the impact of legal protection of bank minority shareholders (noncontrolling shareholders) and bank creditors (e.g. depositors or debt-holders) on bank dividend payout policies using a panel data set of 5,918 banks from 52 countries over the period 1998-2007, after controlling for country-level deposit insurance coverage and bank- and country-level regulatory pressures. Design/methodology/approach – Tobit panel regression models are used to examine the impact of legal protection of shareholders and creditors on bank dividend payout amounts. And, logit panel regression models are used to examine the impact of legal protection of shareholders and creditors on banks’ likelihood to pay dividends. Findings – The authors support the outcome hypothesis by finding that banks pay higher amount of dividends and, are more likely to pay dividends in strong minority shareholder protection countries. However, the authors reject the substitute hypothesis by finding that banks pay higher dividends and are more likely to pay dividends in weak creditor rights countries, and banks do not substitute weak creditor rights with lower dividend payout amounts. Contrary, the authors support the literature which argues the importance of creditor rights for capital market development because one possible reason for low dividend payouts in strong creditor rights countries could be that the banks retain more profits for extending more loans. Practical implications – By finding that creditor rights index has a negative relation with bank dividend policies in contrast to its positive relation with nonfinancial firms’ dividend policies, the authors support the literature which argues that managers of banks give less importance to factors such as current degree of financial leverage, the contractual constraints such as dividend restrictions in debt contracts, and the financing considerations such as the cost of raising external funds, while deciding about the dividend payments. The authors also suggest to keep financial and nonfinancial firms separate, to better understand the dividend puzzle. Originality/value – Extant literature recognizes that legal institutions such as shareholder protection and creditor rights affect corporate firms’ dividend policies significantly but largely excludes banking sector. This paper, by examining the relations between legal protection of shareholders and creditors and bank dividend policies, fills this research gap.

Baumol’s productive and unproductive entrepreneurship after 25 years

2016 ◽  
Vol 5 (2) ◽  
pp. 130-144 ◽  
Author(s):  
Peter J. Boettke ◽  
Ennio Piano
Keyword(s):  
Political Economy ◽  
Economic Development ◽  
Market Economy ◽  
Institutional Environment ◽  
Entrepreneurial Activity ◽  
Comparative Case Study ◽  
Content Type ◽  
History Of ◽  
The Impact

Purpose – The purpose of this paper is to consider the impact of Baumol’s work on entrepreneurship has had on framing the economic development puzzle. Design/methodology/approach – In many ways, the intuition behind the paper is straightforward. Entrepreneurs allocate their time and attention based on the relative payoffs they face in any given social setting. If the institutional environment rewards productive entrepreneurship, then the time and attention of entrepreneurial actors in the economy will be directed toward realizing the gains from trade and the gains from innovation. If, on the other hand, there are greater returns from the allocation of that time and attention toward rent-seeking and even criminal activity, alert individuals will respond to those incentives accordingly. The simplicity of the point being made is part of the brilliance in Baumol’s article. As with other classics in economics, once stated the proposition seems to be so basic it is amazing that others did not put it that way beforehand. Findings – It has been 25 years since Baumol published his paper in the Journal of Political Economy, and as pointed out, it has had a significant scientific impact. But to put things in perspective, James Buchanan’s “An economic theory of clubs” published in 1965 has accumulated roughly 3,500 citations, F.A. Hayek’s “The use of knowledge in society,” published in 1945 has over 12,000, and Ronald Coase’s “The problem of social cost” published in 1960 has over 28,000 citations. So Baumol’s paper would put him in rather elite company. The great strength of the paper is to focus the attention on the relative payoffs of productive, unproductive and destructive entrepreneurial activity. But one of the most significant disappointments of the subsequent history of this paper is a methodological one. The comparative case study approach that Baumol employed did not result in a renewed appreciation for narrative forms of empirical research in political economy. It could legitimately be argued that the sort of questions about the fundamental institutional causes of economic growth and development can only be captured with these more historical methods. Attempts to force fit this analysis into a set of methodological tools which have already revealed themselves to be inadequate to do justice of the role of institutions and disregard the underlying cultural norms and beliefs that characterize human sociability. Originality/value – In this paper, the authors will focus on the contribution made by Baumol’s 1990 paper on the field of comparative political economy, and in particular on the literature on transitional political economy. Section 2 places Baumol’s argument in the context of the failure of neoclassical growth theory. Section 3, the authors argue that although the Baumol framing was an improvement over the old comparative economic systems literature, contemporary transitional political economists have failed to fully realize the implications of the institutional revolution. They have therefore been unable to understand the causes of the heterogeneity of outcomes among those countries that transitioned from communism to the market economy in the 1990s. In Section 4, the authors argue that the political economy of transition will gain from a more sophisticated view of the economic process of the market economy, an appreciation of the entrepreneurial function, and a deeper understanding of the role of formal and informal institutions and their effect on entrepreneurship. The authors will illustrate the point with some examples from the recent history of the Russian political and economic transition. Credible commitment problems and the deficiencies of the institutional reforms of the early 1990s were responsible for the failure of reallocating the entrepreneurial talent that existed in the Soviet economy to productive economic activities. The framework can therefore be used to solve the puzzle of why the announced liberalization of Russian markets and privatization of previously state-owned resources led to economic stagnation, the growth of black markets, and the rise of organized crime, instead of economic development through the operations of smoothly operating markets. Section 5 briefly concludes.

Knowledge and entrepreneurship creation: what is the connection?

2017 ◽  
Vol 13 (1) ◽  
pp. 2-15 ◽  
Author(s):  
Cristina Fernandes ◽  
João Ferreira ◽  
Mário Raposo ◽  
Ricardo Hernández ◽  
Juan Carlos Diaz-Casero
Keyword(s):  
Small Firms ◽  
Future Research ◽  
Process Data ◽  
Content Type ◽  
Creation Process ◽  
Country Level ◽  
Business Creation ◽  
The Impact ◽  
Gem Data

Purpose With this work, the authors seek to advance knowledge in this field mentioned above. The purpose of this paper is to stress the role of two groups of components related to individuals’ knowledge: the intrinsic base of existing knowledge and exposure to external knowledge. Design/methodology/approach The present study examined the impact of knowledge in the business creation process. Data came from aggregated panel data at the country level taken from the Global Entrepreneurship Monitor over a five-year period (2009-2013). Findings Results show that knowledge affects the business creation process. The research identifies the following factors as influential: detection of capabilities, entrepreneurial experience, and experience investing in other firms. Research limitations/implications The limitations of the research relate to the data aggregation at the country level. Future research should examine disaggregated GEM data for the three economic stages at the classification level. Practical implications The perception of self-efficacy appears to be critical in understanding the planning of intentional behavior because of its influence on the formation of intentions through situational perceptions of viability. Originality/value Generally, the literature that emphasizes the role of knowledge and entrepreneurship in small firms is theoretically limited and focuses solely on the role of knowledge in the decision to start a business.

Institutions and entrepreneurial activity: a comparative analysis of Kosovo and other economies

2021 ◽  
Vol 10 (1) ◽  
pp. 98-119
Author(s):  
Fadil Sahiti
Keyword(s):  
Human Capital ◽  
National Level ◽  
Institutional Quality ◽  
International Perspective ◽  
Entrepreneurial Activity ◽  
Access To Finance ◽  
Research Attention ◽  
Content Type ◽  
Country Level ◽  
The Impact

PurposeThis paper investigates institutional quality and its impact on entrepreneurship activities in a less-developed economy. The unifying characteristic of government policies in less-developed contexts is that, often, the primary focus of policy makers is not entrepreneurs and, especially, not the impact of these intuitions on entrepreneurs. This paper aims to show that this impact can be considerable. The author investigates political and macroeconomic institutions and regulations, human capital and skills development and access to finance.Design/methodology/approachThis paper investigates institutions that have major impact on entrepreneurship activities in a less-developed economy. The data used for the analysis is focused on Kosovan entrepreneurship, but the findings are presented in the wider context of economies. The aim of the investigation in this study is to identify whether certain regulations and institutions in different countries affect the level of entrepreneurship activity. In addition, the purpose is to identify similarities and differences among entrepreneurship patterns in diverse economic and institutional settings and to capture this diversity within a common framework. Most of institutions that are subject of analysis belong to one of the following dimensions: political, legal and regulatory institutions, educational institutions geared towards entrepreneurship and the quality of the financial system (e.g. cost of and access to finance). What the empirical results in this paper show is that the impact of such institutions on entrepreneurship can be considerable. The more conducive and qualitative the country’s institutional conditions are, the higher the likely levels of entrepreneurship and vice versa.FindingsThe results of the investigation suggest that compared to the reference countries, entrepreneurship in Kosovo is subject to numerous constraints. However, they suggest, also, that the most binding of these are related to institutional quality, followed by the cost of finance and human capital limitations.Originality/valueThere are few studies in the entrepreneurship literature that use data at the country level, a level that provides a considerable level of precision on the quest to understand what propels and constraints entrepreneurial activity. Given the scarcity of studies at the country level, this study aims to contribute in three ways. First, it aims to advance our discussion of how institutions can rightfully support business creation and retention in a less-developed economy. Second contribution is empirical. Entrepreneurship research rarely incorporates the analysis of several cohorts of firm entrants and exits from a developing and relatively young economy, which, so far, has received little research attention. Third, this analysis contributes to the development of a comparative methodology to measure entrepreneurship activities from an international perspective. The findings obtained for a less-developed economy are compared to data for four benchmark countries, to measure entrepreneurship at the national level.

Classroom interdisciplinary diversity and entrepreneurial intentions

2019 ◽  
Vol 61 (7/8) ◽  
pp. 832-849 ◽  
Author(s):  
Laura Padilla-Angulo ◽  
René Díaz-Pichardo ◽  
Patricia Sánchez-Medina ◽  
Lovanirina Ramboarison-Lalao
Keyword(s):  
University Students ◽  
Self Efficacy ◽  
Positive Impact ◽  
Entrepreneurial Intentions ◽  
Entrepreneurial Activity ◽  
School Students ◽  
Cross Sectional ◽  
Content Type ◽  
Positive Effects ◽  
The Impact

Purpose The purpose of this paper is to examine the impact of classroom interdisciplinary diversity, a type of classroom diversity that has been under-examined by previous literature, on the formation of university students’ entrepreneurial intentions (EI). Design/methodology/approach Based on Ajzen’s theory of planned behaviour and the interactionist model of creative behaviour by Woodman et al. (1993), this paper provides empirical evidence demonstrating that classroom interdisciplinary diversity is important in the formation of university students’ EI at early educational stages using a cross-sectional study design and survey data on first-year business school students and partial least squares analysis. Findings Classroom interdisciplinary diversity is important in the formation of university students’ EI through its positive impact on entrepreneurial perceived behavioural control (PBC) (self-efficacy), a key antecedent of EI. Practical implications The results have important implications for educational practice as well as for both public and private organisations willing to promote entrepreneurial activity, in particular, the positive effects of combining people with different profiles and career fields of interest on entrepreneurial PBC (self-efficacy). Originality/value This study contributes to the scant literature on early university experiences in entrepreneurship education and their influence on EI. It studies the impact of an under-examined dimension of diversity (classroom interdisciplinary diversity) on the formation of students’ EI.

Entrepreneurial activity in China and Pakistan: a GEM data evidence

2014 ◽  
Vol 6 (2) ◽  
pp. 179-193 ◽  
Author(s):  
Muhammad Anwar ul Haq ◽  
Muhammad Usman ◽  
Nazar Hussain ◽  
Zafar-uz-Zaman Anjum
Keyword(s):  
Design Methodology ◽  
Fear Of Failure ◽  
Entrepreneurial Activity ◽  
Global Entrepreneurship Monitor ◽  
Cross Sectional ◽  
Content Type ◽  
Self Employment ◽  
Doing Business ◽  
Gem Data ◽  
Conducive Environment

Purpose – This study aims to compare the entrepreneurial activity in China and Pakistan based on these factors: fear of failure, perceived capabilities, perceived opportunities, and knowledge of other entrepreneurs. Design/methodology/approach – The authors use the data from global entrepreneurship monitor (GEM). In this study, the authors use the cross-sectional data for survey year 2010, both for China and Pakistan. The authors employed the sequential logistic regression model in order to predict the likelihood of involvement in entrepreneurial activity. Findings – Chinese are not significantly influenced by their fear of failure to engage in entrepreneurial activity. Gender is also not a significant predictor of entrepreneurial activity in China. In Pakistan, perception of opportunities does not significantly predict whether to involve in entrepreneurial activity or not, while other factors do. Gender is a significant predictor of entrepreneurial activity in Pakistan. Originality/value – Previously literature is lacking in this kind of a unique comparison based upon GEM data evidence. There are many lessons for Pakistan in this study. There is a need to create awareness among people about the fruits of self-employment. Government should create a conducive environment for doing business. Efforts should be made to enhance the women participation in business.

scholarly journals Corporate debt maturity and economic development

2019 ◽  
Vol 15 (5) ◽  
pp. 669-687 ◽  
Author(s):  
Celia Álvarez-Botas ◽  
Víctor M. González-Méndez
Keyword(s):  
Developing Countries ◽  
Economic Development ◽  
Financial Crisis ◽  
Firm Size ◽  
Debt Maturity ◽  
Corporate Debt ◽  
Content Type ◽  
Country Level ◽  
The Relationship ◽  
Bank Concentration

Purpose The purpose of this paper is to analyse the effect of economic development on the influence of country-level determinants on corporate debt maturity, bearing in mind firm size and the period of financial crisis. Design/methodology/approach The authors employ panel data estimation with fixed effects to examine the role of economic development in influencing the relationship between country-level determinants on corporate debt maturity. The paper uses a sample of 30,727 listed firms, belonging to 39 countries, over the period 2005–2012. Findings Corporate debt maturity increases with the efficiency of the legal system and bank concentration and decreases with the weight of banks in the economy. However, the importance of these country determinants is greater in developing than in developed countries. The authors also show that firm size in developed and developing countries influences country determinants of corporate debt maturity. Finally, the results reveal that the financial crisis has affected the debt maturity of firms differently in developed and developing countries, with the effect of bank concentration lengthening debt maturity, this effect being more pronounced in developing countries. Practical implications The findings provide useful insights to guide policy decisions providing access to long-term financing, as corporate debt maturity depends on economic development, institutional environment, banking structure and firm size. Originality/value This study incorporates economic development in explaining the relationship between country-level determinants and corporate debt maturity.

scholarly journals Greater fit and a greater gap

2019 ◽  
Vol 26 (4) ◽  
pp. 561-594
Author(s):  
Steven A. Brieger ◽  
Dirk De Clercq ◽  
Jolanda Hessels ◽  
Christian Pfeifer
Keyword(s):  
Life Satisfaction ◽  
Institutional Environment ◽  
Entrepreneurial Activity ◽  
Worker Rights ◽  
Content Type ◽  
Person Environment Fit ◽  
High Power Distance ◽  
High Degree ◽  
The Impact ◽  
Low Uncertainty

Purpose The purpose of this paper is to understand how national institutional environments contribute to differences in life satisfaction between entrepreneurs and employees. Design/methodology/approach Leveraging person–environment fit and institutional theories and using a sample of more than 70,000 entrepreneurs and employees from 43 countries, the study investigates how the impact of entrepreneurial activity on life satisfaction differs in various environmental contexts. An entrepreneur’s life satisfaction arguably should increase when a high degree of compatibility or fit exists between his or her choice to be an entrepreneur and the informal and formal institutional environment. Findings The study finds that differences in life satisfaction between entrepreneurs and employees are larger in countries with high power distance, low uncertainty avoidance, extant entrepreneurship policies, low commercial profit taxes and low worker rights. Originality/value This study sheds new light on how entrepreneurial activity affects life satisfaction, contingent on the informal and formal institutions in a country that support entrepreneurship by its residents.

Financial Access of Latin America and Caribbean Firms: What Are the Roles of Institutional, Financial, and Economic Development?

2021 ◽  
pp. 097265272110153
Author(s):  
Lan Khanh Chu
Keyword(s):  
Economic Development ◽  
Latin America ◽  
Jel Classification ◽  
Caribbean Region ◽  
Country Level ◽  
Level Data ◽  
Latin America And Caribbean ◽  
The Impact ◽  
Moderating Role

This article examines the impact of institutional, financial, and economic development on firms’ access to finance in Latin America and Caribbean region. Based on firm- and country-level data from the World Bank databases, we employ an ordered logit model to understand the direct and moderating role of institutional, financial, and economic development in determining firms’ financial obstacles. The results show that older, larger, facing less competition and regulation burden, foreign owned, and affiliated firms report lower obstacles to finance. Second, better macro-fundamentals help to lessen the level of obstacles substantially. Third, the role of institutions in promoting firms’ inclusive finance is quite different to the role of financial development and economic growth. JEL classification: E02; G10; O16; P48

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