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What makes you entrepreneurial? Using machine learning to investigate the determinants of entrepreneurship in China

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  • Liu, Feng
  • Long, Xiao
  • Dong, Lin
  • Fang, Mingjie

Abstract

Entrepreneurs and entrepreneurship are essential for new wealth creation and economic growth, particularly in developing countries. The objective of this study is to develop a model to identify the determinants of entrepreneurship, and reveal how it can be predicted based on individual characteristics, family environment, and social environment. Employing 16 sets of machine learning algorithms on data collected from the Chinese General Social Survey in 2017, we find the best-performing algorithms (i.e., lasso, ridge, and elastic net regression) and examine the effects of the feature variables on entrepreneurship. Overall, this study provides significant theoretical underpinnings for entrepreneurship research, and offers insights for individuals and policymakers by revealing various drivers of entrepreneurship.

Suggested Citation

  • Liu, Feng & Long, Xiao & Dong, Lin & Fang, Mingjie, 2023. "What makes you entrepreneurial? Using machine learning to investigate the determinants of entrepreneurship in China," China Economic Review, Elsevier, vol. 81(C).
    • Handle: RePEc:eee:chieco:v:81:y:2023:i:c:s1043951x23001141
    DOI: 10.1016/j.chieco.2023.102029
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    More about this item

    Keywords

    Entrepreneurs; Entrepreneurship; Machine learning; China;
    All these keywords.

    JEL classification:

    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups
    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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