The Coupling between Entrepreneurship and Public Policy: Tight in Developed Countries but Loose in Developing Countries

Resumen

In this paper we compare the coupling between entrepreneurship policy andentrepreneurship activity in developed and developing countries. Using newinstitutional arguments, we argue that developing countries are prone toimplement policies that (1) are based on experiences in developed countrieswhich have not proven to transfer fittingly to developing economies, (2) areonly partly implemented and are not internally consistent as a result of a lack ofresources to do so, and (3) are more beneficial on paper than on actual activity.Following this perspective, the coupling between entrepreneurship policy andentrepreneurship activity is hypothesized to be lower for developing countriesthan for developed countries. Using GEM data correlating the TEA index ofearly-phase entrepreneurship with indicators of policies obtained from keyexpert informants supports this proposition.