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Comparing Global Data on Entrepreneurship

Mark Marich

As governments across the globe have become more aggressive in promoting innovation and entrepreneurship, they have also increased their demand for new data about these phenomena. Responding to this demand, two well-known data sets---the Global Entrepreneurship Monitor (GEM) and the World Bank Group Entrepreneurship Survey---have generated the greatest interest among researchers and policy makers. A recent World Bank-sponsored research paper examines similarities and differences between these two data sources.

The two sources do yield different findings: the GEM data show comparatively higher levels of entrepreneurship in developing countries, while the World Bank data shows comparatively higher rates of entrepreneurship in more developed economies. The different emphases of each survey may help explain these findings. The GEM research assesses entrepreneurial intent, i.e. it asks whether a respondent is involved in starting a business. Meanwhile, the World Bank survey assesses whether a new business has been formally started. According to the researchers, GEM data may measure “the potential supply of entrepreneurs whereas the World Bank data may represent the actual rate of entrepreneurship.” They further suggest that the benefits of formally registering a business are likely to be higher in developed economies, thus contributing to somewhat higher proportions of such ventures.

The July 2008 World Bank Policy Research Working Paper (#4667), “What Does 'Entrepreneurship' Data Really Show? A Comparison of the Global Entrepreneurship Monitor and World Bank Group Datasets,” by Zoltan J. Acs, Sameeksha Desai, and Leora F. Klapper.

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