Impact of Cultural Factors on Entrepreneurship: Evidence From GEM Model and the Singularity of Japan

Impact of Cultural Factors on Entrepreneurship: Evidence From GEM Model and the Singularity of Japan

Jose Ramón Gutierrez Martin (ESDEN Business School, Spain)
DOI: 10.4018/978-1-5225-5837-8.ch020

Abstract

Since the 1990s there has been extensive literature about the main factors impacting on entrepreneurship activity, and therefore on the genesis and development of entrepreneurship ecosystems. Among these factors, cultural ones are of the most interest because they are specific to every community and may become essential to boost or break the entrepreneurship activity. A lot has been written about these cultural factors, especially at reaching conclusions from specific cases. However, any kind of cross-country analysis of these cultural factors has been much less widely published, with some rare exceptions. Indeed, this chapter aims to fill this gap, enhancing knowledge about entrepreneurship with a cross-country analysis on the impact of cultural factors, using models and data from Global Entrepreneurship Monitor (GEM). Moreover, particular focus has been done on Japan because of its nature as an hapax legomenon country that lets us better appreciate the impact of these factors.
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Introduction

The Conceptual Model

Since the 1990s there has been extensive literature about main factors affecting Entrepreneurship activity, and therefore on the genesis and development of Entrepreneurship Ecosystems. Research activity on these topics has been reinforced over the last few years after the economic downturn of 2008-2013, especially in Europe, the US and Eastern Asia countries.

From the author’s own experience dealing with entrepreneurs at some of the leading worldwide start-up hot spots, the critical impact of some environmental factors on Entrepreneurship activity has been clearly evidenced. In this regard, cultural elements are of the most interest, because they are specific to every community and may become essential boosters or brakes on Entrepreneurship activity.

A lot has been written about these cultural factors, especially at reaching conclusions from specific cases, (see Kneller, 2007, and Aoyama, 2009). However, any kind of cross-country analysis of these cultural factors has been much less widely published, with some rare exceptions (see Suzuki, Hoonkim, & TaeBae, 2002; Sagie & Elizur, 2003).

Indeed, the aim of this paper is to fill this gap, enhancing knowledge about Entrepreneurship with a cross-country analysis on the impact of cultural factors, using models and data from Global Entrepreneurship Monitor (GEM), for 2016 and 2017. Suitability to use the GEM framework is based on previous works, such as those by Bygrave, Hay, Ng, & Reynolds (2003) and Sternberg & Wennekers (2005).

Based on the GEM model, this chapter develops a cross-country analysis of GEM metrics onto its six areas, showing some evidence that could seem paradoxical. In more detail, it is seen that the US leads most of the indicators, and China has become an emerging star, but it is not easy to understand some of Japan’s indicators unless some non-explicit factors are taken into consideration. Furthermore: what is behind such low rates in Japan regarding Self–Perceptions and Societal Values towards Entrepreneurship? What is different in Japan with regards to others that impact so dramatically on these indicators, pointing out a singular path regarding Entrepreneurship among the rest of the most developed countries, and consequently leading to a very different ecosystem?

An attempt to answer to above questions is developed in the last epigraph of this paper, which explains why metrics in Japan show such low values, proposing answers based on Japan's own geographic, historical and mind-set features.

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