“The Bottom Billions and Business Creation: Entrepreneurship in Developing Economies”
Over 100 million of the 1.8 billion midlife adults living on less than $15 a day are attempting to create new firms. Another 110 million are managing new ventures. This is almost half of the global total of 450 million individuals involved with 350 million start-ups and new ventures. They are responsible for almost half of all new firms and one third of new firm jobs. For the poor, business creation provides more social and personal benefits than illegal and dangerous migration, criminal endeavours, or terrorism. Almost all of the business creation by the bottom billions occurs in developing countries, half are in Asia. The ventures initiated by the bottom billion are a significant proportion of all firms expecting growth, exports, an impact on their markets, and in high tech sectors. Assessments based on multi-level modelling suggest
that young adults, whether they are rich or poor, in countries with access to informal financing and an emphasis on traditional, rather than secular-rational, and self-expressive values are more likely to identify business opportunities and feel confident about their capacity to implement a new firm. Such entrepreneurial readiness is, in turn, associated with more business creation. Compared to the strong associations of informal institutions with business creation, formal institutions have very modest and idiosyncratic relationships. Expansion of access to secondary education and early stage financing may be the most effective routes to more firm creation among the bottom billion.
Biography
Paul D. Reynolds is as Research Professor of Management at George Washington University. He has held faculty appointments at the University of California, Riverside; University of Minnesota; Marquette University; Babson College; London Business School, and Florida International University and visiting and research appointments at the U of Michigan, U of Pennsylvania Wharton School, INSEAD in France, and Nanyang Technical University in Singapore. Reynolds completed undergraduate work in engineering at the U of Kansas (BS; 1960); all graduate work was completed at Stanford University, with degrees earned in business (1964; MBA), psychology (1966; MA), and sociology (1969; PhD). Over the past 20 years he was the coordinating principal investigator of two longitudinal studies of US business creation [Panel Studies of Entrepreneurial Dynamics, I and II] and the founding principal investigator of a fifty nation comparison of entrepreneurial activity [Global Entrepreneurship Monitor]. Reynolds recently completed an extensive assessment of the participation of the bottom billions in business creation. He is also the author or co-author of five books; seven edited collections; 42 research reports and monographs; 85 peer review journal articles and book chapters; eight data sets in the ICPSR archives; and over two hundred presentations to professional and policy audiences. In 2004 Reynolds received the annual Swedish International Award for Entrepreneurship and Small Business Research and the 2012 Dedication to Entrepreneurship Award from the Academy of Management Entrepreneurship Division.