Entrepreneurship and Competition, what is the role of a Countries' Competitiveness?

Opportunity-entrepreneurship is one of the key drivers of economic growth in a country. The level of entrepreneurial activity has a link with the competitiveness of a country. This study investigates this link between the level of competition across countries and entrepreneurship. Opportunity-entrepreneurship is measured in this study by the Global Entrepreneurship Index (GEI). To capture the competition of a country, twelve different pillars of competitiveness are used. The pillars are derived from the Global Competitiveness Index published by the World Economic Forum. In total 132 countries are in the database over four different years, where the most recent year (2016) is used as main investigation year. Positive robust associations are found between entrepreneurial activities in a country and the strength of institutions, the level of higher education and training, the technological readiness and the market size; i.e. when there is a higher competitiveness score for these pillars, the entrepreneurial activity within the country will increase. On the other hand, labour market efficiency appears to have a negative association with entrepreneurial activity within a country.