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HOW IS ENTREPRENEURSHIP VIEWED IN THE EUROPEAN UNION?

Entrepreneurship is viewed favourably across the European Union, with people northern and southern EU countries with a more positive view than those in central and eastern EU countries. Nonetheless, fewer people in the EU see it as having an important role in the economy relative to the United States. By doing more to stimulate positive attitudes towards entrepreneurship through the education system and offering a mix of entrepreneurship support aimed at youth, policy makers can increase start-up intentions and improve the quality of business start-ups in EuropeEntrepreneurship is viewed favourably across the European Union, with people northern and southern EU countries with a more positive view than those in central and eastern EU countries. Nonetheless, fewer people in the EU see it as having an important role in the economy relative to the United States. By doing more to stimulate positive attitudes towards entrepreneurship through the education system and offering a mix of entrepreneurship support aimed at youth, policy makers can increase start-up intentions and improve the quality of business start-ups in Europe

Entrepreneurship plays an important role in driving innovation, creating jobs and stimulating economic growth. It is also increasing playing a role in addressing social exclusion and helping to solve social challenges. Attitudes towards entrepreneurship are an important factor influencing levels of entrepreneurial activity across economies and social groups ¹.

Attitudes to entrepreneurship

In the European Union (EU), people generally have a positive view of entrepreneurship. Recent surveys suggest that more than 90% of people view entrepreneurs as “broadly favourable” or “neutral”, notably because they are seen as being important for job creation (87%) and creating new products and services that benefit everyone (79%) ². These numbers suggest that people in the EU generally have an understanding and appreciation of the role of entrepreneurship in an economy. International surveys show that people in the EU are more likely to view entrepreneurs as favourable or neutral than in Japan (84%) and Korea (83%) but less likely than in the United States where 95% of people believe that entrepreneurship is positive ³.

Within the EU, attitudes towards entrepreneurship vary greatly across Member States. Generally, people in northern and southern European countries have a more positive attitude towards entrepreneurship. In Denmark, Ireland, Finland, Spain, Estonia, Italy and France, more than 60% of people view entrepreneurs as “broadly favourable”, which is in contrast to the eastern EU countries such as Slovak Republic and Hungary where fewer than 35% of people view entrepreneurs favourably ⁴. These differences can be explained by several factors ⁵. First, entrepreneurship is a very new concept in several central and eastern European countries that began their transition to market economies after 1989 (e.g. Poland, Hungary, Czech Republic and Slovak Republic). Therefore, adults in these countries are less likely to have experience with entrepreneurship or have knowledge about its function in the economy. Second, countries with high unemployment rates (i.e. Southern European countries) often have higher levels of self-employment since there are not many opportunities for work. People are therefore more likely to have experience with entrepreneurship and to view it favourably. Finally, countries with high labour market participation rates for women also tend to have rates of self-employment among women. Therefore, there tends to be a more positive attitude towards entrepreneurship.

There are also differences in attitudes towards entrepreneurship across different social target groups. Women in the EU are slightly less likely than men to take a favourable view of entrepreneurs ⁶, which is consistent with the traditional gender stereotypes that make business ownership less desirable for women, e.g. due to household and family-related roles ⁷. Moreover, older people have a slightly negative view on the role that entrepreneurs play because most have spent their career in employment.

Nurturing a positive attitude towards entrepreneurship can bring various benefits for society. First, educating people about the role of entrepreneurship and cultivating entrepreneurial attitudes can be expected to increase business start-up intentions. Second, it can help people become more entrepreneurial, innovative and flexible, which has benefits beyond starting a business. These attributes are valued by employers and can also be useful in volunteer work or other elements of personal life. Third, developing a positive social attitude towards entrepreneurship can help create a more supportive environment for business creation. This is especially important for those who are under-represented or disadvantaged in entrepreneurship (e.g. youth, women, older people, people with disabilities, immigrants and ethnic minorities), who are more likely to face negative stereotypes and discrimination, and often have lower levels of self-confidence. Finally, fostering positive attitudes may also improve the quality of entrepreneurship activities, since those who understand entrepreneurship and view it favourably are more likely to seek training and other forms of support, and know where to get this support ⁸.

One of the key policy levers available to support the development of positive attitudes towards entrepreneurship involves providing information about the nature, challenges and benefits of entrepreneurship through formal education. Recent surveys indicate that adults in the majority of European Union countries agree that their school education helped them to develop an entrepreneurial attitude and a sense of initiative. Agreement on this point is highest in Portugal (75%), Romania (73%) and Finland (64%) ⁹.

The best results are achieved with a progression model, which introduces entrepreneurship through a gradual change of content, pedagogy, learning outcomes and assessment strategies ¹⁰. An example is Denmark, where the Danish Foundation for Entrepreneurship supports entrepreneurship education from kindergarten to PhD. In primary education the objective is to develop creativity, problem solving, critical thinking, perseverance, and self-control. In lower secondary education an emphasis is added with specific courses on subject knowledge (e.g. financial literacy), and in upper secondary, vocational and tertiary education, students learn about innovation management, business growth models and internationalisation.

Developing entrepreneurial attitudes and intentions through higher education

With average entry rates of young people into Higher Education Institutions (HEIs) of close to 58% in Bachelor or equivalent study programmes across the OECD area in 2014, expectations are growing for HEIs to play a more active role in supporting graduate entrepreneurship. The economic and social benefits associated with graduate entrepreneurship are likely to be particularly high given the high level of skills of the founders and their proximity to knowledge and technology.

HEIs are increasingly introducing courses and initiatives to teach entrepreneurship. So far, OECD-European Commission policy reviews ¹¹ in the European Union find that the emphasis has been placed on entrepreneurship education activities that aim to stimulate entrepreneurial attitudes, as well as developing the knowledge and skills needed to identify opportunities and launch businesses to exploit them.

Even if the “spark of genius” is important for entrepreneurship, most of what is needed to successfully take a new idea to market can be learned. The starting point is “opportunity refinement”, i.e., the competency to discover opportunities emerging from the content and the contextual knowledge that students gain in their studies, as well as opportunities that arise from involvement in research activities, and to refine these into viable business ideas. This competency is complemented by the leveraging of internal and external resources, and by “championing”, that is, taking leadership in organising these resources in the form of a new firm ¹².

To effectively help nascent entrepreneurs develop the competencies that increase their chances of success, education and training programmes have to include both technical and social skills. Ideally, such training should be available for all interested students, regardless of their area of study, because many innovative and viable business ideas are likely to arise from the combination of technical, scientific and creative studies. Recent OECD research finds that business start-up courses with a focus on “opportunity refinement” are primarily offered in the fields of business and economics. These courses should be opened to all students as idea generation and opportunity refinement activities that make use of interdisciplinary groups of students (i.e. with diverse backgrounds, interests, knowledge and skills) result in more diversity in the ideas and projects that the groups come up with ¹³. A main challenge facing interdisciplinary activities though is their dependence on faculty buy-in; not all faculty members view entrepreneurship as relevant to their field. To overcome this barrier, idea generation and opportunity refinement activities are often organised outside the curriculum. Student demand for these activities is increasing, as data from the HEIs that were surveyed confirms.

To date, the emphasis in HEIs has been on entrepreneurship education activities aimed at developing a set of attitudes, knowledge and skills that allow students to identify opportunities and turn them into successful ventures. But, entrepreneurship education cannot stand alone if HEIs are to become environments conducive for nascent entrepreneurs. Mentoring, active involvement of students in research activities, creating co-working spaces and incubation facilities, as well as providing assistance with intellectual property rights and accessing public and private financing are key complementary support services that HEIs have been introducing over the last two decades. Often, the demand for introducing these services is coming directly from students and staff.

The decision to start-up a business may not occur during studies or directly after graduation. Rather, it often takes place after an initial period of employment during which graduates gain experience in how businesses and markets operate. According to the latest Global University Entrepreneurial Spirit Students’ Survey ¹⁴, around 8% of the students surveyed intended to start a business right after graduation, whereas about 30% of the surveyed students considered this a likely career option five years after graduation ¹⁵. Students thus may not look for start-up support in the first case, but for education activities that stimulate their creativity and require the application of knowledge to solving real-world challenges. These activities are often extra-curricular in nature. It is important that students have the possibility to document the competencies and skills developed in such activities, for example with diploma supplements or other certificates, in particular when they decide to delay their start-up and to initially look for a paid job.

The entrepreneurial and innovative HEI

To support the development of entrepreneurial mind sets and culture, HEIs also need to be entrepreneurial themselves in the sense of how they perceive and organise their key functions in the areas of education, research, and engagement in terms of resource allocation, staff incentives and continuous professional development initiatives − and on how they position themselves in local, national and global strategic partnerships. Public policy has an important role to play in this by providing frameworks and incentives that promote entrepreneurial approaches in HEIs.

The OECD and the European Commission have developed the HEInnovate tool (www.heinnovate.eu) to support HEIs and policy makers making higher education more entrepreneurial and innovative. HEInnovate includes a framework that sets out the seven dimensions of the “entrepreneurial university” and an accompanying online self-assessment tool to help HEIs organise a participatory stock-taking exercise to review achievements and identify areas for improvement. It is possible to involve a wide range of higher education stakeholders in this exercise, including university leadership, academic and administrative staff, key partner organisations, and to repeat the exercise over time ¹⁶. The core of the self-assessment tool is available in all EU Member State languages. It includes guidance on preparing and support entrepreneurs.

Going beyond education to develop entrepreneurial attitudes

Promoting a positive attitude towards entrepreneurship has been a priority for many EU governments in recent years as they look for ways to stimulate job creation. The principal approaches include information campaigns that inform about the role of entrepreneurs in society, promoting entrepreneurship as a potential career path through public employment services and career counselling, and showcasing successful role models to inspire people with an interest in entrepreneurship.

Promoting positive attitudes towards entrepreneurship has been an important part of addressing the youth unemployment crisis in the EU. As a result, EU countries have implemented the Youth Guarantee, which assures that all youth under 25 years old receive a quality offer of employment, further education, apprenticeship or training within 4 months after they complete their formal education or find themselves unemployed. To support the implementation of the Youth Guarantee, the European Union provides additional financial resources under the Youth Employment Initiative to countries that have regions where youth unemployment is above 25%.

EU Member States are using a wide range of policies and programmes to promote and support entrepreneurship for youth. Many countries such as Spain and Lithuania have developed youth entrepreneurship strategies that use multi-pronged approaches, including the promotion of entrepreneurship role models, entrepreneurship training offers, entrepreneurship coaches and mentors, and the use of awards and media campaigns showcase success to inspire others. Evidence shows that the most intensive forms of support (e.g. coaching and mentoring, entrepreneurship training) are the most effective at changing attitudes and stimulating entrepreneurial intentions but it is important to couple these with lower cost methods that have a wider reach.¹⁷

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