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Institutional Determinants of Macro-Level Entrepreneurship


  • Michael E. Valdez,

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    • Michael E. Valdez is an assistant professor of Stillman School of Business, Seton Hall University, 400 South Orange Avenue, South Orange, NJ 07040, USA.
  • James Richardson

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    • James Richardson is an associate professor of Shidler College of Business, University of Hawaii, 2404 Maile Way, Honolulu, HI 96733, USA.

Please send correspondence to: Michael E. Valdez, tel.: (973) 761-7950; e-mail: and to James Richardson at


This multicountry study empirically explores the institutional determinants of macro-level entrepreneurship. Findings suggest that a society's normative, cultural-cognitive, and regulative institutions are related to entrepreneurial activity. Normative and cultural-cognitive institutions’ descriptive power in explaining entrepreneurial activity is higher than regulative institutions' or per capita gross domestic product. This suggests that differences in values, beliefs, and abilities may play a greater role than purely economic considerations of opportunity and transaction costs. Specific attention is given to opportunity- and necessity-motivated entrepreneurship due to their relationship to economic development.