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Culture, institutions and new business activity: evidence from the global entrepreneurship monitor

Levie, J.D. and Hunt, S. (2005) Culture, institutions and new business activity: evidence from the global entrepreneurship monitor. In: Frontiers of Entrepreneurship Research 2004: proceedings of the twenty-fourth annual entrepreneurship research conference. Babson College, Babson Park, USA, pp. 519-533. ISBN 0910897255

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Abstract

This research examines the extent to which culture can explain differences in new business activity across nations, and considers both universal cultural values using measures derived from the Schwartz Values Survey on 47 nations and new business activity-related beliefs using measures derived from 2003 Global Entrepreneurship Monitor (GEM) data on 31 nations. Associations between these measures and measures of new business activity derived from the 2002 and 2003 Global Entrepreneurship Monitor in 40 nations are examined using Hierarchical Linear Modelling. The results indicate that new business activity varies with new business activity-related beliefs but not with basic cultural values at the national level, when basic demographic and economic variables are controlled for. This finding supports recent theory on culture and behaviour. A model of culture, institutions and new business activity is proposed to take the research further.