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Modelling Entrepreneurship


Author Info

  • Niels Bosma

    (EIM Business and Policy Research, Zoetermeer)

  • Gerrit de Wit

    (EIM Business and Policy Research, Zoetermeer)

  • Martin Carree

    (University of Maastricht and Erasmus University Rotterdam)


Two approaches can be distinguished with respect to modelling entrepreneurship: (i) the approachfocusing on the net development of the number of entrepreneurs in an equilibrium framework and (ii)the approach focusing on the entries and exits of entrepreneurs. In this paper we unify these ap-proaches to arrive at a model explaining the equilibrium and actual number of entrepreneurs and theentry and exit rate of entrepreneurs simultaneously and consistently. We apply our unified approach tothe Netherlands using self-employment data for the 1960-99 period. We find error-correction of about20% per year and a very different situation in terms of disequilibrium before and after the early 1980's.Periods of high unemployment appear to be characterized by both high entry and high exit rates.

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Bibliographic Info

Paper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 03-014/3.

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Date of creation: 17 Feb 2003
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Handle: RePEc:dgr:uvatin:20030014

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Keywords: self-employment; entry; exit.;

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Cited by:
  1. Leitão, João & Ferreira, João, 2007. "Liberalization of European Telecommunications and Entrepreneurship: Why German and Portuguese Experiences are so Equal and so Different?," MPRA Paper 5728, University Library of Munich, Germany.
  2. José Antonio Belso Martínez, 2004. "Tasa óptima de empresarialidad y desarrollo económico. Evidencias para el caso español," Estudios de Economia, University of Chile, Department of Economics, vol. 31(2 Year 20), pages 207-225, December.
  3. Howard Frederick & Erik Monsen, 2011. "New Zealand’s perfect storm of entrepreneurship and economic development," Small Business Economics, Springer, vol. 37(2), pages 187-204, September.


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