entrepreneurship by necessity

Oct 13, 2025 by recoveryshake.com 14 views

Global Entrepreneurship Monitor (GEM): A Comprehensive Study on Entrepreneurship

Introduction

The Global Entrepreneurship Monitor (GEM) is a renowned global study that provides valuable insights into the world of entrepreneurship. Conducted by a consortium of research centers from around the world, the GEM study has been a leading authority on entrepreneurship since its inception in 1999. The study's primary objective is to understand the dynamics of entrepreneurship, including the factors that influence entrepreneurial activity, the types of entrepreneurs, and the impact of entrepreneurship on the economy.

Entrepreneurship by Opportunity and Necessity

One of the key aspects of the GEM study is its examination of entrepreneurship by opportunity and necessity. Entrepreneurship by opportunity refers to the creation of new businesses driven by the desire to pursue a new idea or opportunity, often with a focus on innovation and growth. On the other hand, entrepreneurship by necessity is driven by the need to create a business due to circumstances such as unemployment, poverty, or a lack of job opportunities. The GEM study has found that entrepreneurship by opportunity is more prevalent in developed economies, while entrepreneurship by necessity is more common in developing economies.

According to the GEM study, entrepreneurship by opportunity is characterized by:

A higher level of education and skills among entrepreneurs
A greater emphasis on innovation and R&D
A higher level of entrepreneurial activity, including the creation of new businesses and the expansion of existing ones
A greater impact on the economy, including the creation of jobs and the generation of wealth

On the other hand, entrepreneurship by necessity is characterized by:

A lower level of education and skills among entrepreneurs
A greater emphasis on survival and sustainability
A lower level of entrepreneurial activity, including the creation of new businesses and the expansion of existing ones
A lower impact on the economy, including the creation of jobs and the generation of wealth

Cultural Factors

The GEM study also examines the role of cultural factors in shaping entrepreneurial activity. Cultural factors refer to the values, norms, and beliefs that influence entrepreneurial behavior and decision-making. The study has found that cultural factors can have a significant impact on entrepreneurial activity, including:

Risk tolerance: The willingness to take risks is a key factor in entrepreneurial activity. Cultures that value risk-taking and entrepreneurship are more likely to have high levels of entrepreneurial activity.
Collectivism vs. individualism: Collectivist cultures, which emphasize the importance of group harmony and cooperation, may be less conducive to entrepreneurship than individualist cultures, which emphasize individual freedom and autonomy.
Time orientation: Cultures that value long-term planning and investment may be more conducive to entrepreneurship than cultures that value short-term gains and instant gratification.

Infrastructure Conditions

The GEM study also examines the role of infrastructure conditions in shaping entrepreneurial activity. Infrastructure conditions refer to the availability and quality of resources, including finance, technology, and human capital. The study has found that infrastructure conditions can have a significant impact on entrepreneurial activity, including:

Access to finance: The availability of financing options, including loans and venture capital, can have a significant impact on entrepreneurial activity.
Access to technology: The availability of technology, including internet and digital infrastructure, can have a significant impact on entrepreneurial activity.
Access to human capital: The availability of skilled and educated workers can have a significant impact on entrepreneurial activity.

Public Policies

The GEM study also examines the role of public policies in shaping entrepreneurial activity. Public policies refer to the laws, regulations, and programs that influence entrepreneurial behavior and decision-making. The study has found that public policies can have a significant impact on entrepreneurial activity, including:

Tax policies: Tax policies, including tax rates and tax incentives, can have a significant impact on entrepreneurial activity.
Regulatory policies: Regulatory policies, including laws and regulations related to business formation and operation, can have a significant impact on entrepreneurial activity.
Support programs: Support programs, including training and mentorship programs, can have a significant impact on entrepreneurial activity.

Conclusion

The Global Entrepreneurship Monitor (GEM) is a comprehensive study on entrepreneurship that provides valuable insights into the dynamics of entrepreneurial activity. The study's examination of entrepreneurship by opportunity and necessity, cultural factors, infrastructure conditions, and public policies has shed light on the complex factors that influence entrepreneurial behavior and decision-making. By understanding these factors, policymakers and entrepreneurs can develop strategies to promote entrepreneurship and economic growth.

Recommendations

Based on the findings of the GEM study, the following recommendations can be made:

Promote entrepreneurship by opportunity: Governments and policymakers should focus on creating an environment that encourages entrepreneurship by opportunity, including providing access to finance, technology, and human capital.
Address entrepreneurship by necessity: Governments and policymakers should focus on addressing the root causes of entrepreneurship by necessity, including poverty, unemployment, and lack of job opportunities.
Foster a culture of entrepreneurship: Governments and policymakers should focus on fostering a culture of entrepreneurship, including promoting risk-taking, innovation, and entrepreneurship.
Develop supportive infrastructure: Governments and policymakers should focus on developing supportive infrastructure, including access to finance, technology, and human capital.
Implement supportive public policies: Governments and policymakers should focus on implementing supportive public policies, including tax policies, regulatory policies, and support programs.

Future Research Directions

The GEM study has provided valuable insights into the dynamics of entrepreneurial activity. However, there are still many areas that require further research, including:

The impact of technology on entrepreneurship: The study of the impact of technology on entrepreneurship, including the role of digital infrastructure and the use of digital tools.
The role of women in entrepreneurship: The study of the role of women in entrepreneurship, including their participation rates, entrepreneurial activity, and challenges.
The impact of public policies on entrepreneurship: The study of the impact of public policies on entrepreneurship, including the effectiveness of tax policies, regulatory policies, and support programs.

References

Global Entrepreneurship Monitor (GEM). (2020). Global Entrepreneurship Monitor 2020 Report.
Global Entrepreneurship Monitor (GEM). (2019). Global Entrepreneurship Monitor 2019 Report.
Global Entrepreneurship Monitor (GEM). (2018). Global Entrepreneurship Monitor 2018 Report.
Global Entrepreneurship Monitor (GEM) Q&A: Insights and Answers

Introduction

The Global Entrepreneurship Monitor (GEM) is a comprehensive study on entrepreneurship that provides valuable insights into the dynamics of entrepreneurial activity. In this Q&A article, we will delve into the key findings of the GEM study and provide answers to some of the most frequently asked questions about entrepreneurship.

Q1: What is the Global Entrepreneurship Monitor (GEM) study?

A1: The GEM study is a global research project that aims to understand the dynamics of entrepreneurial activity, including the factors that influence entrepreneurial behavior and decision-making. The study is conducted by a consortium of research centers from around the world and has been a leading authority on entrepreneurship since its inception in 1999.

Q2: What are the key aspects of the GEM study?

A2: The GEM study examines several key aspects of entrepreneurship, including:

Entrepreneurship by opportunity and necessity
Cultural factors, including risk tolerance, collectivism vs. individualism, and time orientation
Infrastructure conditions, including access to finance, technology, and human capital
Public policies, including tax policies, regulatory policies, and support programs

Q3: What is entrepreneurship by opportunity and necessity?

A3: Entrepreneurship by opportunity refers to the creation of new businesses driven by the desire to pursue a new idea or opportunity, often with a focus on innovation and growth. Entrepreneurship by necessity, on the other hand, is driven by the need to create a business due to circumstances such as unemployment, poverty, or a lack of job opportunities.

Q4: What are the characteristics of entrepreneurship by opportunity and necessity?

A4: Entrepreneurship by opportunity is characterized by:

A higher level of education and skills among entrepreneurs
A greater emphasis on innovation and R&D
A higher level of entrepreneurial activity, including the creation of new businesses and the expansion of existing ones
A greater impact on the economy, including the creation of jobs and the generation of wealth

Entrepreneurship by necessity, on the other hand, is characterized by:

A lower level of education and skills among entrepreneurs
A greater emphasis on survival and sustainability
A lower level of entrepreneurial activity, including the creation of new businesses and the expansion of existing ones
A lower impact on the economy, including the creation of jobs and the generation of wealth

Q5: What is the role of cultural factors in shaping entrepreneurial activity?

A5: Cultural factors, including risk tolerance, collectivism vs. individualism, and time orientation, can have a significant impact on entrepreneurial activity. Cultures that value risk-taking and entrepreneurship are more likely to have high levels of entrepreneurial activity.

Q6: What is the role of infrastructure conditions in shaping entrepreneurial activity?

A6: Infrastructure conditions, including access to finance, technology, and human capital, can have a significant impact on entrepreneurial activity. The availability of financing options, including loans and venture capital, can have a significant impact on entrepreneurial activity.

Q7: What is the role of public policies in shaping entrepreneurial activity?

A7: Public policies, including tax policies, regulatory policies, and support programs, can have a significant impact on entrepreneurial activity. Tax policies, including tax rates and tax incentives, can have a significant impact on entrepreneurial activity.

Q8: What are the key recommendations of the GEM study?

A8: The GEM study recommends that governments and policymakers focus on:

Promoting entrepreneurship by opportunity
Addressing entrepreneurship by necessity
Fostering a culture of entrepreneurship
Developing supportive infrastructure
Implementing supportive public policies

Q9: What are the future research directions of the GEM study?

A9: The GEM study recommends that future research focus on:

The impact of technology on entrepreneurship
The role of women in entrepreneurship
The impact of public policies on entrepreneurship

Q10: Where can I find more information about the GEM study?

A10: You can find more information about the GEM study on the official GEM website, which provides access to reports, data, and other resources related to the study.

Conclusion

The Global Entrepreneurship Monitor (GEM) study provides valuable insights into the dynamics of entrepreneurial activity. By understanding the factors that influence entrepreneurial behavior and decision-making, policymakers and entrepreneurs can develop strategies to promote entrepreneurship and economic growth.