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For decades, scholars have been concerned with the role of public policy in stimulating entrepreneurial activity. Aside from pro-entrepreneurship policy, governments can also erect barriers to startup activity. Researchers have concluded that the degree of corruption in a country can become a significant deterrent to entrepreneurship, while researc...
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... Pathak, and Wennberg (2013) recommend the use of a multilevel approach in studies of institutions and entrepreneurship, and they encourage GEM data entrepreneurship research to use this technique. Thus, we estimate a model specified by the following equation (Equation (1)): Table 2 presents the correlations among the controls, predictors, and dependent variables). The combination of m ijt + 1 jt comprises the random part of the equation, where 1 jt represents the country-level residuals, and m ijt represents the individual-level residuals. ...Similar publications
The entrepreneurial ecosystem in developing countries is not as vibrant as in the developed countries, this is because of the inherent institutional, organizational, and framework conditions that exist in these countries, bureaucracy is one of the reasons that affects entrepreneurship in these countries and especially startups, this study aims to i...
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... Without building a reputation as a trustworthy partner, Ukrainian startups face diminished opportunities for securing the external resources necessary to activate and scale their operations. The prevalence of corruption undermines confidence in the Ukrainian market among international investors and partners (Lecuna et al., 2020). ...
As global conflicts and hostilities become more prevalent, it is essential to investigate the conditions necessary for the operation and growth of innovative enterprises considering post-war recovery. The paper aims to determine crucial favorable conditions for activating innovative entrepreneurship and startups in the post-war period in Ukraine. The analysis is based on inductive, qualitative data from 24 interviews with the respondents from Ukraine and the Netherlands (eight scientists, ten startup founders and entrepreneurs, two government officials, and four entrepreneurs) to identify a range of favorable factors by utilizing qualitative analysis. The paper used individual, in-depth, semi-structured interviews. The study identified eight constraining aggregate themes (the consequences of war, policy and regulatory system, market and investment, the ecosystem, passive universities, education and skills, internationalization, and culture) and three enabling aggregate themes (the consequences of war, active universities, and the ecosystem) through the grouping of factors from the second-order code. The most significant constraining factor from aggregate themes “the consequences of war” is brain drain (40.63%). Among the eight constraining aggregate themes, 32.55% identified the policy and regulatory system as the main obstacle due to the absence of an effective strategy, ineffective legislation, passive municipalities, and bureaucracy. Moreover, the lack of funds is a critical issue in addressing the consequences of the war, financing startup projects, and creating favorable conditions. The results emphasize constraining and enabling conditions for activating innovative entrepreneurship and startups. Such results are helpful for policymakers to improve the conditions for startup development by overcoming the immediate identified obstacles. AcknowledgmentThe publication was prepared in the framework of the MSCA4Ukraine postdoctoral fellowship (Oksana Khymych Ref.№ UKR 1233171), which is funded by the European Union that provides support and funding for the Ukrainian researchers displaced by the war, while the Consortium (a consortium comprised of Scholars at Risk Europe hosted at Maynooth University, Ireland (project coordinator), the German Alexander von Humboldt Foundation (AvH) and the European University Association (EUA)) is a collaborative network of institutions managing and implementing this initiative. The views and opinions expressed in this report are solely those of the authors and do not reflect the views of the European Union or the MSCA4Ukraine Consortium. Neither the European Union, the MSCA4Ukraine Consortium, nor any individual member institutions of the Consortium can be held responsible for these views and opinions. We would like to express our sincere gratitude to the colleagues at Vrije Universiteit Amsterdam for their invaluable support in conducting the research and for fostering an environment conducive to academic excellence and innovation.
... One of the biggest factors depriving firms of performance is internal bureaucracy, which causes issues with effectiveness and agility. Research by Becheikh and Bouaddi (2023), Kamal (2021), and Lecuna et al. (2020) are only two instances of the body of work that emphasizes the negative consequences that bureaucratic roadblocks have on companies. The main obstacles to Moroccan enterprises' growth and competitiveness have been described as lengthy and complex administrative processes, complex legislative frameworks, and slow decision-making. ...
The research, a pioneering effort in Morocco, explores the intricate elements driving new startups' viability using AI models. It employs a range of advanced techniques such as decision trees, random forests, logistic regression, support vector machine (SMV), ensemble techniques, and neural networks. The study uncovers unique perspectives on the complex interplay between internal variables like human capital, strategic planning, and internal bureaucracy and external factors like government support, mentorship, and competition that shape entrepreneurship performance. The findings, which reveal a dual and unexpected influence of internal bureaucracy and a multifaceted contribution of human capital, are particularly relevant in the dynamic startup landscape. Mentorship and financial resources emerge as critical contributors to startups’ success. This review, the first of its kind in Morocco, offers special insights into the factors influencing entrepreneurial success. The discoveries have the potential to revolutionize our understanding of how organizations operate in Morocco and their significant implications for enterprising undertakings, providing a practical guide for startups in the region.
... To examine the impact of governance upon business growth, we have used three measures of governance, i.e. time required to start a business, profit tax, and corruption. By following Lecuna et al (2020); van Stel et al (2007), we use time to start business as the first measure of governance as this can reflect bureaucracy. Time required to start a business is the number of calendar days needed to complete the procedures to legally operate a business, measured in days. ...
... Next, we use tax by following Ojeka (2011); Henrekson et al (2010), where in this paper, profit tax refers to the amount of taxes on profits paid by the business, measured in percent. Third, we also employed corruption perception variable as used by Lecuna et al (2020); Achim (2017); Mongay & Filipescu (2012); and Anokhin & Schulze (2009). Corruption perception is taken from The Corruption Perceptions Index (CPI), an index published annually by Transparency International. ...
ASEAN is one of the fastest growing economies in the world and is one of the five largest economies in the world after the US, EU, China, and Japan. ASEAN-5, the founding countries of Indonesia, Malaysia, the Philippines, Singapore, and Thailand ("ASEAN-5"). The ASEAN-5 countries represent 6% of the world's population with a GDP of US$2.75 trillion, growing at an average rate of 3.7% in 2019. With a supportive business climate, ASEAN-5 countries could be the preferred destinations for local or foreign companies to venture into new businesses. This study aims to analyze the impact of governance and digital infrastructure on new business growth in ASEAN-5 countries, using panel data regression approach. This study finds that profit tax, corruption perception, internet user, secure internet and access to electricity are significantly correlated with new business growth. Time to start a business is found to be insignificant but negatively correlated with growth, implying that more efficient bureaucracy promotes business growth.
... For instance, Mohammadi Khyareh (2017) found that corruption reduces the efficiency and productivity in economics, impacting a negative relation between institutional quality and productive entrepreneurship while corruption control positively affects entrepreneurship (Dempster & Isaacs, 2017). Also, Lecuna et al. (2020) stated that the better controlled corruption is, the more effective entrepreneurial activity becomes. However, in circumstances of postconflict economies, acting ''off-the-books'' to avoid taxation is perceived as the main form of corruption, while entrepreneurs generally treat it as the norm (N. ...
... On the other hand, we did find that corruption and crime predict lower levels of entrepreneurial activity and indicate a malfunctioning society (Estrin et al., 2013). Similarly, Mohammadi Khyareh (2017) also found that corruption undermines efficiency and productivity in economies, and Lecuna et al. (2020) note that, the better controlled corruption is in the society, the more effective the entrepreneurial activity is. However, the present study reveals an interesting genderbased distinction between the effects of corruption and social safety (crime, violence, and vandalism). ...
The aim of this article is to examine whether the cross-country and gender variations of entrepreneurship can be explained within the institutional framework. The study addresses normative forces to which entrepreneurs are expected to adapt within European welfare states. The normative forces are focused on norm-based factors of governmental quality and value-based factors of governmental generosity, which are both hypothesized to be associated with entrepreneurship at the level of society and furthermore from the gender perspective. To verify our hypotheses, the research was conducted among 28 European countries in the years 2012 to 2018. We adopted the macro-level of analysis and undertook panel data analysis (PDA). We estimated the econometric models with entrepreneurship rates as dependent variables and those with norm-based and value-based factors as independent variables. The results confirm that norm-based factors are associated with entrepreneurship and there are significant differences in the responses of female and male entrepreneurial activities to the quality of government. However, we did not find supporting evidence for the statistically significant impact of governmental generosity on entrepreneurship. The novelty of our research is in implementing institutional theory into the discussion on entrepreneurship from the welfare state perspective, by introducing the concept of norm-based and value-based factors which reflect the quality and generosity of the government. We also distinguish between the impact of governmental quality and generosity on entrepreneurship from the gender perspective to contribute to the discussion on the gender gap in entrepreneurship.
... A country's bureaucratic environment can play a crucial role in influencing perceptions and challenges in starting a business (Ahadi and Kasraie, 2020;Huang et al., 2021). Bureaucracy and corruption significantly affect people's intention to be entrepreneurs (Lecuna, Cohen and Mandakovic, 2020). An effective public administration influences receptivity to start-ups and contributes in individuals' innovative efforts (Patel and Wolfe, 2022). ...
... According to Lecuna et al. (2020) there are wide differences in procedures and time required to start a business in countries around the world. For instance, an individual in Mozambique must complete 19 procedures that take at least 149 working days and pay fees of US$256 in order to comply with government criteria to start a business. ...
... An Italian future entrepreneur who wants to do the same must go through 16 procedures, pay US$3946 in fees, and wait at least 62 working days to get the required licenses. In contrast, an entrepreneur in Canada can complete the process in two days by paying US$280 in fees and completing only two processes (Lecuna, Cohen, and Mandakovic, 2020). According to Global Entrepreneurship Monitor (GEM) governments around the world need to create optimal environmental conditions for individuals to start and grow their business. ...
Public sector worldwide faces the challenge to contribute in the public value creation. To accomplish that, public administration forced to adopt tools and practices from the private sector, such as “strategic management”, “performance measurement”, “customer focus, “innovation management”, and “public entrepreneurship” as best practices in order to improve social and economic welfare.
... A country's bureaucratic environment can play a crucial role in influencing perceptions and challenges in starting a business (Ahadi and Kasraie, 2020;Huang et al., 2021). Bureaucracy and corruption significantly affect people's intention to be entrepreneurs (Lecuna, Cohen and Mandakovic, 2020). An effective public administration influences receptivity to start-ups and contributes in individuals' innovative efforts (Patel and Wolfe, 2022). ...
... According to Lecuna et al. (2020) there are wide differences in procedures and time required to start a business in countries around the world. For instance, an individual in Mozambique must complete 19 procedures that take at least 149 working days and pay fees of US$256 in order to comply with government criteria to start a business. ...
... An Italian future entrepreneur who wants to do the same must go through 16 procedures, pay US$3946 in fees, and wait at least 62 working days to get the required licenses. In contrast, an entrepreneur in Canada can complete the process in two days by paying US$280 in fees and completing only two processes (Lecuna, Cohen, and Mandakovic, 2020). According to Global Entrepreneurship Monitor (GEM) governments around the world need to create optimal environmental conditions for individuals to start and grow their business. ...
Public sector worldwide faces the challenge to contribute in the public value creation. To accomplish that, public administration forced to adopt tools and practices from the private sector, such as "strategic management", "performance measurement", "customer focus, "innovation management", and "public entrepreneurship" as best practices in order to improve social and economic welfare. The present research includes some of the most significant factors related to the external environment, focusing on national policies and on public administration related issues that impact on people's entrepreneurial intention and on the development of entrepreneurship in general. The literature on a study topic was assessed, analyzed, and synthesized using the integrative or critical review approach in a way that promotes the formation of new theoretical frameworks and perspectives. The contribution of the study lies in two points, first this research approach is not common on the administration literature and secondly it adds more information from the current literature, and this could help researchers and policymakers to identify the key practices that will promote entrepreneurship. Findings showed that issues such as corruption, bad regulatory system, and the lack of public policies prevent individuals from being entrepreneurs, while other issues such as entrepreneurship education programs supported by governments, transparency, open governance and citizen's trust are factors that boost innovation within a country and make individuals more optimistic to start their own business.
... In a recent report on Portugal's competitiveness, among the negative factors hampering entrepreneurial activity were: 'inefficient government bureaucracy', 'tax rates', 'restrictive labour regulations' and also, an 'insufficient capacity to innovate' and an 'inadequately educated workforce' (World Economic Forum 2018). Empirical evidence shows that procedural bureaucracy may constitute an impediment to entrepreneurship (Lecuna, Cohen, and Mandakovic 2020). The experts also expressed their concern on the need to increase the transparency of the processes. ...
This research aims to understand the relevant pre-conditions and barriers for territorial innovation behind the Research and Innovation Strategies for Smart Specialisation (RIS3) of a lagging European Union (EU) region. For that purpose, a Delphi was conducted to a panel of experts responsible for the design of the RIS3 of the Centro region of Portugal. Consensus was reached on the role of determinant factors for territorial innovation, but the operationalization and effectiveness of the RIS3 remained debatable. Policy recommendations focus on the need to increase the inclusiveness of different actors and knowledge in RIS3 and overcome some of its barriers.
... The intention of entrepreneurs to launch a start-up, including their behavior, can be strongly influenced by government barriers. In this light, Lecuna et al. [17] applied the theory of planned behavior to observe the influence of corruption and inefficient bureaucracy on entrepreneurship. The results conclude that political factors play a crucial role in simplifying regulations that facilitate business development. ...
This paper explores the relationship between public policy and entrepreneurial activity in EU countries by using the panel threshold model. The paper was fundamental based on and confirmed the psychological threshold theory; namely, the results showed a single threshold effect between government effectiveness and entrepreneurial activity. Government public policy boosts entrepreneurial activity at the first segment, but the promotion effect becomes relatively slow after the threshold value. When separating the EU countries into efficiency-driven and innovation-driven countries, the threshold effect only existed in innovation-driven countries. After the threshold value, governance effectiveness hindered entrepreneurial activity, because saturation and excessive regulations impeded business in these countries. In essence, it is not a matter of working harder or winding down but a matter of promoting a moderate public policy, which is indeed necessary for the government to encourage entrepreneurial activity. Ultimately, keeping economic growth stable is essential for a favorable entrepreneurial environment.
... Corruption reduction is a more difficult task, although attempts to improve state modernization, transparency, and accountability have been done successfully. The theories were tested using data on people from 53 countries from 2006 to 2015 in the study conducted by (Lecuna et al., 2020). This study indicates that both are negatively linked with startup activity rates, and that in highly corrupt countries, the two components combine to further lower startup activity. ...
The Philippines currently has one unicorn startup named Revolution Precrafted valued at $1 billion (Rivas, 2021). Over the past 15 years, the country’s ASEAN neighbors had been producing startup unicorns in an exponential manner. Global innovation profiles such as China, France, Israel, South Korea, Mexico, and Sweden have demonstrated excellent government programs, policies, and directives in developing a healthy entrepreneurial and innovation ecosystem. On the other hand, the Philippines’ yearly forecasted new business registration from 2021 to 2025 falls significantly short of the expected range to develop strong businesses. This paper addressed the social issue on why there are a few if not zero unicorn startups amidst its high pool of talented entrepreneurs and scholars having a median age of 21.4 (Philippine Statistics Authority, 2021).
This paper suggests a holistic approach in solving this problem by integrating seven factors into the equation namely (1) individualism, (2) education, (3) platform, (4) ecosystem, (5) socio-cultural, (6) politico-legal, and (7) roadmap 4.0. The results were tested against the Fire Escape Method formulated by the researcher based on qualitative facts presented locally and globally.
Studies of networks for educational change often focus on webs of teachers, school leaders, policymakers, and philanthropists, with little attention to staff at the middle level, who arguably have immense potential to effect change. This article explores an initiative for educational change through mid-level staff using the case of a nonprofit that places its members in large, public education bureaucracies in a developing country. I explore a mechanism for how the strategic patchwork of staff can support change through improved bureaucracy. First, staff are intentionally placed, reputationally distinct, and purposely connected. Second, these individuals influence bureaucratic effectiveness through coordinated policies, reduced organizational friction, and informal information sharing. Third, the improved coordination supports policy creation, program implementation, and candid evaluation of processes on the ground. Integrating studies of education, state bureaucracy, and civil society, I show the utility in investigating novel forms of educational change that engage rather than circumvent traditional education bureaucracies.
