A theoretical grounding and test of the GEM model

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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 (https://doi.org/10.1007/s11187-008-9136-8)

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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.

ORCID iDs

Levie, J.D. ORCID logoORCID: https://orcid.org/0000-0002-3073-8351 and Autio, Erkko;
CORE (COnnecting REpositories)