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Unraveling the Shift to the Entrepreneurial Economy

  • Roy Thurik
  • David Audretsch
  • F. Stam

A major shift in the organization of developed economies has been taking place: away from what has been characterized as the managed economy towards the entrepreneurial economy, or what Kirchhoff (1994) has called dynamic capitalism. In particular, the empirical evidence provides consistent support that (1) the role of entrepreneurship has significantly increased, and (2) a positive relationship exists between entrepreneurial activity and economic performance. However, the factors underlying this observed shift have not been identified in a systematic manner. The purpose of this paper is to suggest some of the factors leading to this shift and implications for public policy. In particular, we find that technological change is a fundamental catalyst underlying the shift from the managed to the entrepreneurial economy. However, it was not just technological change but rather involved a multitude of factors, ranging from the demise of the communist system, increased globalization, new competition for multinational firms and higher levels of prosperity. Recognition of the causes of the shift from the managed to the entrepreneurial economy implies a shift in public policy directions. Rather than to focus of directly and exclusively on promoting new firms and small firms, it may be that the current approach to entrepreneurship policy is misguided. The priority should not be on entrepreneurship policy but rather a more pervasive and encompassing approach, policy consistent with an entrepreneurial economy.

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File URL: http://www.entrepreneurship-sme.eu/pdf-ez/H201113.pdf
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Paper provided by EIM Business and Policy Research in its series Scales Research Reports with number H201113.

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Length: 29 pages
Date of creation: 22 Dec 2011
Date of revision:
Handle: RePEc:eim:papers:h201113
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  1. repec:cup:cbooks:9780521894920 is not listed on IDEAS
  2. Dominique Foray, 2006. "The Economics of Knowledge," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262562235, June.
  3. Audretsch, David B & Carree, Martin A & Thurik, A R Roy & van Stel, André, 2005. "Does Self-Employment Reduce Unemployment?," CEPR Discussion Papers 5057, C.E.P.R. Discussion Papers.
  4. Audretsch, David B. & Keilbach, Max C. & Lehmann, Erik E., 2006. "Entrepreneurship and Economic Growth," OUP Catalogue, Oxford University Press, number 9780195183511, March.
  5. Audretsch, David B & Sanders, Mark, 2007. "Globalization and the Rise of the Entrepreneurial Economy," CEPR Discussion Papers 6247, C.E.P.R. Discussion Papers.
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  8. Sander Wennekers & André Stel & Roy Thurik & Paul Reynolds, 2008. "Nascent entrepreneurship and the level of economic development," Small Business Economics, Springer, vol. 30(3), pages 325-325, March.
  9. Jovanovic, Boyan & Rousseau, Peter L., 2005. "General Purpose Technologies," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 18, pages 1181-1224 Elsevier.
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  11. Jose Maria Millan & Jolanda Hessels & Roy Thurik & Rafael Aguado, 2011. "Determinants of Job Satisfaction across the EU-15: A Comparison of Self-Employed and Paid Employees," Tinbergen Institute Discussion Papers 11-043/3, Tinbergen Institute.
  12. Falck, Oliver & Gold, Robert & Heblich, Stephan, . "Entrepreneurship education," Chapters in Economics, University of Munich, Department of Economics.
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  15. Ejermo, Olof & Kander, Astrid, 2006. "The Swedish Paradox," Papers in Innovation Studies 2006/1, Lund University, CIRCLE - Center for Innovation, Research and Competences in the Learning Economy.
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  19. E. Stam & B. Nooteboom, 2011. "Entrepreneurship, Innovation and Institutions," Working Papers 11-03, Utrecht School of Economics.
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