nep-gro New Economics Papers
on Economic Growth
Issue of 2022‒03‒28
two papers chosen by
Marc Klemp
University of Copenhagen

  1. Cultural diversity and innovation-oriented entrepreneurship By Paula Prenzel; Niels Bosma; Veronique Schutjens; Erik Stam
  2. Knowledge Economy and the Economic Performance of African Countries: A Seemingly Unrelated and Recursive Approach By Voxi Heinrich Amavilah; Antonio Rodriguez Andres

  1. By: Paula Prenzel; Niels Bosma; Veronique Schutjens; Erik Stam
    Abstract: A growing empirical literature has established a positive relationship between cultural diversity and entrepreneurship rates, often attributing this effect to innovative benefits of diversity. However, not all entrepreneurship is inherently innovative, raising the question of whether cultural diversity may increase the relative prevalence of entrepreneurs pursuing innovative instead of more replicative strategies. This study investigates the relationship between regional cultural diversity and the innovation-orientation of early-stage entrepreneurs and considers moderating factors by decomposing shares of foreign-born population by origin within and outside of the EU and by education level. Combining survey data from the Global Entrepreneurship Monitor with various measures of cultural diversity, we carry out a multilevel analysis for 166 European regions. The results suggest that entrepreneurs in more culturally diverse regions are significantly more likely to exhibit innovation-orientation. We find some evidence that this effect is supported by cognitive proximity as the share of EU-born foreign population is driving this result. Moreover, our analysis suggests that the effect of cultural diversity on innovative entrepreneurship is not due to human capital availability or moderated by entrepreneurs' absorptive capacity but rather stems from the diversity in cultural background itself.
    Keywords: cultural diversity, entrepreneurship, innovation, European regions, multilevel analysis
    JEL: F22 L26 O30 R1
    Date: 2022–02
  2. By: Voxi Heinrich Amavilah (Economics/Division of Behavioral and Social Sciences Estrella Mountain College); Antonio Rodriguez Andres (Faculty of Management Technology, German University in Cairo)
    Abstract: Knowledge has emerged as a potentially key driver of economic growth and competitiveness, thereby attracting more attention in Africa than before because it is crucial to understand the factors and policies that influence the knowledge economy (KE) process and economic performance.
    Keywords: Knowledge economy, African countries, Seemingly unrelated regression, Economic growth
    JEL: O10 I20 O55 O33 O40 C2 C3 C51
    Date: 2022–02

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