Picture of scraped petri dish

Scrape below the surface of Strathprints...

Explore world class Open Access research by researchers at the University of Strathclyde, a leading technological university.

Explore

A theoretical grounding and test of the GEM model

Levie, J.D. and Autio, Erkko (2008) A theoretical grounding and test of the GEM model. Small Business Economics, 31 (3). pp. 235-263. ISSN 0921-898X

[img]
Preview
PDF (A_theoretical_grounding_and_test_of_the_GEM_model_paper.pdf)
A_theoretical_grounding_and_test_of_the_GEM_model_paper.pdf

Download (555kB) | Preview

Abstract

The Global Entrepreneurship Monitor model combines insights on the allocation of effort into entrepreneurship at the national (adult working age population) level with literature in the Aus-trian tradition. The model suggests that the relationship between national-level new business ac-tivity and the institutional environment, or Entrepreneurial Framework Conditions, is mediated by opportunity perception and the perception of start-up skills in the population. We provide a theory-grounded examination of this model and test the effect of one EFC, education and train-ing for entrepreneurship, on the allocation of effort into new business activity. We find that in high-income countries, opportunity perception mediates fully the relationship between the level of post-secondary entrepreneurship education and training in a country and its rate of new busi-ness activity, including high-growth expectation new business activity. The mediating effect of skills perception is weaker. This result accords with the Kirznerian concept of alertness to oppor-tunity stimulating action.