Entrepreneurship and environments: start-ups, growth aspirations, and exit

At the start of the twentieth century, Schumpeter (1908; 1912) postulated the basis for a potential revolution in economics by arguing that the entrepreneur acts as the underlying force of economic growth. Despite Schumpeter’s contribution, the central role of entrepreneurship has only been systematically recognised in the literature in the past few years (Santarelli & Vivarelli, 2007). Santarelli and Vivarelli (2007) contended that the most common way to measure entrepreneurship was to focus on entrepreneurial start-up rates. Shane (2009) suggested that achieving job creation and economic growth from entrepreneurship is not a numbers game and entrepreneurship policy should encourage the formation of high quality, high growth companies. Furthermore, DeTienne (2010) stated that the entrepreneurial process does not end with the creation of a new business, but instead with entrepreneurial exit. Considering the crucial role of entrepreneurship, this thesis will look at these issues through three independent but interrelated studies: The first study introduces and assesses a set of measures of the quality of government that has both theoretical and empirical importance. The results confirm that the quality of government demonstrates varying moderating effects on the relationship between institutions and entrepreneurial start-ups. Drawing on the theory of planned behaviour and the entrepreneurial ecosystem approach, the second study looks at entrepreneurs’ growth aspirations in China. The results suggest that there is a positive relationship between attitude and growth aspirations and that people who perceive a greater sense of control over the outcomes of their actions are more likely to possess growth aspirations. The results also confirm the positive moderating effects of entrepreneurial ecosystems on the relationship between individual motivational aspects and growth aspirations. The third study first assesses how individual cognitive aspects can contribute to distinctions in exit motives. Second, by adopting resource dependence theory, and institutional theory, this study argues that environmental dynamism and institutional ambiguity exert direct and indirect effects on entrepreneurial exit patterns in China.