US Widely Viewed as Entrepreneurial Leader - But Could Do Better

Author: Notre Dame ESTEEM

Entrepreneurship is a global phenomenon, but it is developing differently in different nations. The United States is the world leader in entrepreneurship by most measures, although not all, and Total Entrepreneurial Activity (TEA) rates in the United States have rebounded vigorously since the economic downtown.

The Global Entrepreneurship Monitor (GEM) showed that entrepreneurship rates declined more in the United States than in other innovation countries in 2010. Also, more of them were “necessity entrepreneurs,” starting businesses because they could not find jobs rather than seeking opportunities to expand their income and lifestyle. But in 2011, the United States had over 75 percent more entrepreneurs than the average of the other countries, and in 2012, U.S. entrepreneurship grew to its highest level since GEM started collecting data in 1999. That year, the U.S. startup rate was more than twice as high as the rate of people starting businesses in other wealthy countries.

Likewise, the Global Entrepreneurship & Development Index (GEDI) which analyzes data from more than 120 countries to gauge entrepreneurial attitudes, aspirations, and activities, placed the United States at the top in its 2014 report. Other top countries were Canada, Australia, Sweden, Denmark, Switzerland, Taiwan, Finland, Netherlands, United Kingdom, and Singapore. A 2010 GEDI report showed the United States strong in startup skills, competition, and new technology but weaker in cultural support, the tech sector and high-growth businesses. Also, a World Bank compilation of the rate of newly registered LLCs between 2005 and 2009 placed the United States at the top with Canada, Australia, and the United Kingdom.

Another survey, by the Organization for Economic Cooperation and Development (OECD), ranks the United States lower in entrepreneurship, partly because it does not count self-employed people as entrepreneurs if they do not incorporate or hire others. But the OECD ranked the United States No. 2, after Israel, in the investment of venture capital as a percentage of GDP.  Of 22 countries studied by the OECD, the United States is ninth in the adjusted number of patents by companies younger than five years – Denmark is No. 1 in that category.

Around the world, entrepreneurs deal with various kinds of regulations, tax structures, cultural perspectives, and other obstacles but find ways to launch their enterprises. The opportunities, especially for innovative ideas and products, are increasing as the economy recovers and entrepreneurship becomes a more widely appreciated contributor to national and global economies.