Encouraging
entrepreneurship –
the OECD
perspective
Dr Jonathan Potter, Senior Economist
OECD Centre for Entrepreneurship, SMEs and Local
Development; www.oecd.org/cfe
Structure of the presentation
1. Major entrepreneurship policy challenges
2. Improving information on
entrepreneurship policies
2
The OECD Bologna
process
SMEs, Entrepreneurship
and innovation
3
Policy challenges: OECD Bologna
Process
• First OECD Ministerial Meeting on SME policies,
Bologna, Italy, 2000
• Second OECD SME and entrepreneurship Ministerial
Meeting, Istanbul, Turkey, 2004
• Thematic meetings
– SME and entrepreneurship financing, Brasilia
– SME internationalisation, Athens
– SMEs and global value chains, Tokyo
• Bologna+10 High Level Meeting, Paris, France, 2010
Consult the policy statements: www.oecd.org/cfe/sme
4
Policy challenges: SME,
Entrepreneurship and Innovation Book
• Framework conditions, e.g.
– Remove regulatory obstacles and institutional disincentives
– Support entrepreneurship culture and motivations
• Skills, e.g.
– Build up entrepreneurship education in universities
– Strengthen training for SME managers and workforces
• Knowledge flows, e.g.
– Enhance knowledge-based entrepreneurship
– Promote local and global networks within innovation systems
• Social entrepreneurship , e.g.
– Improve institutions for social entrepreneurship
– Introduce social clause in public procurement
Consult the book: www.oecdbookshop.org
5
Policy challenges: Bologna+10
High-Level Meeting
1. SME innovation, e.g.
– Improve intellectual assets management (advisory services and
adapted IPR system)
– Support participation of SMEs in global value chains
2. Access to finance, especially to growth firms, e.g.
–
–
Phase-out crisis recovery policies to support SME access to finance
Foster the wider use of sound techniques for co-financing
3. Promote green growth, e.g.
–
–
Ensure a stable policy framework for green growth
Raise entrepreneurs’ awareness of the transition toward a
sustainable economy
Consult the Chair’s Summary: www.oecd.org/cfe/sme
6
Information needs
• Benchmarking of countries on entrepreneurship
activity
• Determinants of entrepreneurship activity (culture,
skills, financing etc)
• Impacts of entrepreneurship (innovation,
productivity, jobs etc)
• Target group information (women, youth, old,
minorities, distressed areas etc)
• Policy impacts
• Sub-national data
7
The OECD-EUROSTAT
Entrepreneurship Indicators Project (EIP)
(www.oecd.org/std)
• Goals
– Overcome information gap on an important
economic and social issue
– Encourage countries to use common
definitions, methodologies and classifications
• Methods
– Involvement of NSOs in variable specification
and data production to ensure comparability
– Not a single measure of entrepreneurship, but
various indicators on different aspects
8
The EIP Framework
9
Entrepreneurial determinants:
example of indicators
Access to finance
R&D and technology
Entrepreneurial
capabilities
Ease of getting bank
loans (WEF)
Business R&D intensity,
by size class
Tertiary attainment, 2564 years old
Investments by business
angels
New-to-market
innovating firms, by size
class
Self-employment,
foreign and native-born
population
VC as % of GDP, by
investment stage
Collaboration in
innovation, by size class
International mobility of
students
VC investment in high
tech industries
E-commerce
People having received
training for business
start-ups (GEM)
10
Entrepreneurial performance
indicators
Firm-based
Employment-based
Turnover-based
Employer enterprise
birth-rates
(by industry and size)
Share of high growth
firms
Share of high growth
firms
Employer enterprise
death-rates
(by industry and size)
Share of gazelles
Share of gazelles
One- and two-year
survival rates
Employment creation by
enterprise births
Share of 1- and 2-yearold employer enterprises
Employment destruction
by enterprise death
11
Employer enterprise birth and death rates in manufacturing1
As a percentage of the population of active enterprises in manufacturing with at least one employee
(figures above the bar indicate change from previous year)
Employer birth rate (2006)
Employer death rate (2005)
18.0
16.0
14.0
12.0
Change from previous
year
10.0
8.0
6.0
0
+ 0.3
0
-0.4-0.3
-0.7
-0.3 -0.1 0.2
-1.4 -0.2
-0.3
0.5-1.4 0.1
-0.5
1.3
0.1 2.1 0.3
0
5.4
-1.4 -0.6
0.6 -3.20.8
-1.7
0.1
4.1
2.40.8
0
4.0
2.0
0.0
1. Mining and quarrying; Manufacturing; Electricity, gas and water.
2. Employer enterprises with less than 250 employees.
3. Data are based on the Establishments & Business Frame of the Regional Statistical Institute of Andalucia (IEA). The data refer
to establishments and enterprises with 4 or more persons engaged in an economic activity in Andalucia; they cover active
enterprises with headquarters in Andalucia as well as active establishments with headquarters outside Andalucia. Birth (death)
rates also include enterprises and establishment relocations within Spain to (from) Andalucia.
12
Timely indicator
Enterprise creation
130
Australia
120
Denmark
110
Finland
100
France
Germany
90
Italy
80
Netherlands
70
Average 2006=100, trend-cycle
Norway
60
Spain
50
40
UK
USA
13
Share of gazelles (employment definition), 2006
As a percentage of the population of enterprises in the sector with 10 or more employees
(figures above the bar indicate change from previous year)
Manufacturing (1) (2006)
3.0
Services (2) (2006)
2.5
2.0
0.5
0
Change from previous year
1.5
0
1.0
-0.1
-0.1
-0.1
0.5
-0.2 -0.2
0
-0.3
0.2
0.2
0
-0.1
0.2
-0.1
-0.4
0.2
-0.1
-0.1
0.0
1. Mining and quarrying; Manufacturing; Electricity, gas and water.
2. Wholesale and retail trade; Hotels and restaurants; Transport, storage and communications; Financial intermediation; Real
estate, renting and business activities.
3. Employer enterprises with fewer than 250 employees.
4. 2008.
Source: OECD Structural and Demographic Business Statistics (SDBS) Database
14
Firms with new-to-market product innovations, by size,1
2004-06
As a percentage of all firms
SMEs (1)
30
25
20
15
10
5
0
1. SMEs: 10-249 employees; 10-99 for New Zealand.
2. France: manufacturing only.
Source: OECD (2009), Science, Technology and Industry Scoreboard.
15
OECD & GEDI contributions
OECD:
• firm-level data;
• 34 advanced countries;
• from NSOs;
• across several dimensions
GEDI:
• individual-level data;
• advanced, emerging & developing countries;
• focus on innovative entrepreneurship;
• headline composite indicator
16
Conclusion
• Governments increasingly recognise
SMEs/entrepreneurship in policy
• Better information is needed
• Information should be in line with the
policy challenges (financing, green growth,
social dimension etc)
• GEDI and OECD EIP have important
complementary roles
• They can input to the new OECD-EC
Panorama on Entrepreneurial Activity
17