Models of entrepreneurial behavior focus usually on individual level factors yet a great deal of beginning and running a business depends on the economic, social and institutional environment. Our analysis uses data from the 2008 European Social Survey to assess the weight of country-level characteristics in explaining individual entrepreneurship measured as self-employment of business ownership. The article starts with a literature review which puts the bases of our hypotheses. The results describe cross country comparisons of entrepreneurship rates, individual and country-level regressions of entrepreneurship. As expected, there are large differences between countries with respect to rates of entrepreneurship. A great part of this variance can be accounted for by the division between the former socialist countries and the rest and by levels of urbanization.entrepreneurial behavior, contextual factors, comparative analysis

Hatos Adrian

Hatos Roxana

English

Research Papers in Economics

107 
 
INDIVIDUAL AND CONTEXTUAL DETERMINANTS OF 
ENTREPRENEURSHIP: AN INTERNATIONAL COMPARATIVE ANALYSIS 
Hatos Roxana 
University of Oradea 
Hatos Adrian 
University of Oradea 
 
Abstract 
Models of entrepreneurial behavior focus usually on individual level factors yet a great deal of 
beginning and running a business depends on the economic, social and institutional environment. 
Our analysis uses data from the 2008 European Social Survey to assess the weight of country-
level characteristics in explaining individual entrepreneurship measured as self-employment of 
business  ownership.  The  article  starts  with  a  literature  review  which  puts  the  bases  of  our 
hypotheses. The results describe cross country comparisons of entrepreneurship rates, individual 
and  country-level  regressions  of  entrepreneurship.  As  expected,  there  are  large  differences 
between countries with respect to rates of entrepreneurship. A great part of this variance can be 
accounted for by the division between the former socialist countries and the rest and by levels of 
urbanization. 
 
Keywords entrepreneurial behavior, contextual factors, comparative analysis 
 
JEL: A14 
 
Introduction 
Models of entrepreneurial behavior focus usually on individual level factors yet a great deal of 
beginning and running a business depends on the economic, social and institutional environment. 
Unemployment basically acts as a push factor for self-employment (Audretsch & Thurik, 2006). 
Based on literature review we expect a positive influence of income differentials on the number 
of self-employed (Evans & Leighton, 1990).Most studies investigating the role of motivational 
determinants of the choice for self employment pertain to the individual level. Urban areas will 
give rise to economies of scale through which small-sized entrepreneurship in retailing comes 
under  pressure  (Noorderhaven,  Thurik,  Wennekers,  &  Van  Stel,  2004;  Wildeman  et  al., 
1999).We expect life-dissatisfaction to be positively related with job-dissatisfaction and thus with 
self-employment.  The  role  of  post-materialism  in  explaining  differences  in  self-employment 
between countries is dealt with in Uhlaner et al. (2002). 
 
Data 
We have used the data base of the 2008 European Social Survey which includes answers from 
54988 subjects selected using a stratified probabilistic procedures from the adult populations of  
28 countries. The data were weighted in order to adjust the data base to the size of each country’s 
population. The weighted data base contains 58456 cases. 
 
Variables 
The  dependent  concept  in  the  study  is  entrepreneurship.  Entrepreneurship  was  defined  as 
business  ownership  or  self-employment.  As  such,  we  have  defined  as  entrepreneurs  those 
individuals who, in the European Social Survey indicated their occupational status as being self-
employed or working in family business. According to this definition, 9,9% of the sample qualify 
as entrepreneurs. 
   108 
 
 
Individual-level variables 
Variable name  Description  Measurement  Univariate statistics 
age  Age of respondend  Numeric  Avg=47,1 
Stdev=18,6 
edu_square  Squared  of  Years  of 
full-time  education 
completed 
Numeric  Avg=158,3 
Stdev=101,7 
male  Gender  Dichotomy (1=male)  44,5% 
rural  Residence  Dichotomy (1=rural)  31,6% 
father_empl  Father  self-employed 
at 14 
Dichotomy  (1=self 
employed  when  the 
subject was 14) 
16,3% 
mother_self  Mother self-employed 
at 14 
Dichotomy  (1=self 
employed  when  the 
subject was 14) 
6,0% 
father_sec_ed  1=father  with 
secondary education 
Dichotomy  (1=father 
with  secondary 
education) 
41,9% 
mother_sec_ed  1=mother  with 
secondary education 
Dichotomy (1=mother 
with  secondary 
education) 
43,4% 
 
Contextual variables 
Inspired by the literature we have modeled individual entrepreneurship using severa features of 
the countries in the data base: 
Variable 
name 
Description and source  Measure
ment 
Univar
iate 
statisti
cs 
Frmcomm
unist 
Country former communist or not  Dichoto
my 
(1=forme
r 
communi
st) 
12 
(42%) 
Unempl20
06 
Percent unemployed in 2006 according to labor force surveys 
ILO 
Numeric  Range: 
3,4-
13,5 
Unempl20
07 
ercent unemployed in 2007 according to labor force surveys 
ILO 
Numeric  Range: 
2,5-11 
GDPcapita  Gross  Domestic  Product  per  capita in  2008, from  the  CIA 
Factbook (for Cyprus we have used 2009 estimates) 
Numeric  Range: 
7271-
58141 
Urban  Percent  of  population  living  in  cities,  data  from  the  CIA 
Factbook 
Numeric  Range: 
48-97 
SWL2006  Satisfaction  with  life  index,  data  from 
http://en.wikipedia.org/wiki/Satisfaction_with_Life_Index#In
ternational_Rankings_2006 
Numeric  Range: 
120-
273 109 
 
Materialist  Percent materialist in the population, according to WVS of 
1998-1999,  except  for  Cyprus  where  estimates  from  2006 
were used. 
Numeric  Range: 
6,3-
52,1 
Post_mater
ialist 
Percent materialist in the population, according to WVS of 
1998-1999,  except  for  Cyprus  where  estimates  from  2006 
were used. 
Numeric  Range: 
1,7-
22,7 
 
 
selfem
ployed 
Frmcom
munist 
ampune
mpl2006 
unemp
l2007 
GDPc
apita 
ur
ba
n 
SWL
2006 
Mater
ialist 
Post_mat
erialist 
Belgium  11.36  0  8.3  7.5 
34.49
3  97 
243.3
3  22.2  20.3 
Bulgaria  7.53  1  9  6.9 
12.39
4  71 
143.3
3  48.7  3.2 
Coatia  7.48  1  11.1  9.6 
19.08
5  57 
196.6
7  15.4  19.2 
Cyprus  17.61  0  4.5  3.9  21.2  70  230  37.5  10.5 
Czech 
Republic  9.61  1  7.1  5.3 
24.71
2  73 
213.3
3  25.3  9.8 
Denmark  9.94  0  4.1  4 
36.60
4  87  273.4  8.5  16.1 
Estonia  7.41  1  5.9  4.7 
20.65
7  69  170  41.2  2.6 
Finland  14.53  0  7.7  6.8 
35.42
6  63 
256.6
7  26  10.7 
France  9.17  0  8.8  8 
34.04
5  77  220  27.9  17.9 
Germany  12.1  0  10.3  8.6 
35.61
3  74  240  30.1  15.1 
Greece  28.04  0  8.8  8.1 
29.36
1  61  210  18.9  16.7 
Hungary  6.22  1  7.5  7.4 
19.32
9  68  190  50.5  2.4 
Israel  12.17  0  8.4  7.3 
27.54
8  92 
223.3
3  13.8  12.6 
Latvia  5.56  1  6.8  6 
17.10
1  68 
156.6
7  34.9  4.8 
Netherland
s  12.37  0  4.2  3.5  40.85  82  250  11.8  22 
Norway  10.07  0  3.4  2.5 
58.14
1  77 
246.6
7  13.6  11.2 
Poland  16.06  1  13.8  9.6 
17.62
5  61 
196.6
7  36.9  7.6 
Portugal  12.63  0  7.7  8 
22.08
1  59 
203.3
3  35.6  10 
Romania  4.33  1  7.3  6.4 
14.06
4  54 
173.3
3  45.2  7.1 
Russian 
Federation  4.74  1  7.2  6.1 
16.13
9  73 
143.3
3  52.1  1.7 110 
 
Slovakia  7.46  1  13.3  11 
22.08
1  56  180  45.9  4 
Slovenia  9.56  1  5.9  4.6  27.61  48  220  16.8  16 
Spain  15.88  0  8.5  8.3 
31.95
5  77 
233.3
3  27.1  15 
Sweden  10.6  0  5.4  6.1 
37.38
3  85 
256.6
7  6.3  22.4 
Switzerlan
d  12.92  0  4  3.6 
42.53
4  73 
273.3
3  14.4  18.3 
Turkey  8.9  0  9.9  10.3  13.92  69 
176.6
7  19.3  20.9 
Ukraine  6.5  1  6.8  6.4  7.271  68  120  45.6  3.5 
United 
Kingdom  12.46  0  5.4  5.3 
35.44
5  90 
236.6
7  15.3  22 
 
Bibliography 
1.  Audretsch,  D.,  &  Thurik,  R.  (2006).  A  model  of  the  entrepreneurial  economy. 
Entrepreneurship and economic growth, 32. 
2.  Evans,  D.  S.,  &  Leighton,  L.  S.  (1990).  Small  business  formation  by  unemployed  and 
employed workers. Small Business Economics, 2(4), 319-330. 
3.  Noorderhaven,  N.,  Thurik,  R.,  Wennekers,  S.,  &  Van  Stel,  A.  (2004).  The  Role  of 
Dissatisfaction and per Capita Income in Explaining Self-Employment across 15 European 
Countries. Entrepreneurship: Theory and Practice, 28(5), 447-467. 
4.  Uhlaner, L. M., Thurik, A. R., & Hutjes, J. (2002). Post-materialism as a cultural factor 
influencing  entrepreneurial  activity  across  nations:  Erasmus  Research  Institute  of 
Management. 
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A model of the entrepreneurial economy. Entrepreneurship and economic growth,

Post-materialism as a cultural factor influencing entrepreneurial activity across nations: Erasmus Research Institute of Management.

Self-employment in 23 OECD countries. The role of cultural and economic factors,

Small business formation by unemployed and employed workers.

The Role of Dissatisfaction and per Capita Income in Explaining Self-Employment across 15 European Countries. Entrepreneurship: Theory and Practice,

INDIVIDUAL AND CONTEXTUAL DETERMINANTS OF ENTREPRENEURSHIP: AN INTERNATIONAL COMPARATIVE ANALYSIS

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INDIVIDUAL AND CONTEXTUAL DETERMINANTS OF ENTREPRENEURSHIP: AN INTERNATIONAL COMPARATIVE ANALYSIS

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