Study: Economy Wallops Global Entrepreneurship

Compiled ByDeborah Austin Mirroring the world's economic doldrums, global entrepreneurial activity plunged 25% in the past year. So suggests the 2002 Global Entrepreneurship Monitor (GEM), a study of entrepreneurship and economic growth in 37 countries. From 2001 to 2002, most G7 countries saw especially steep plunges in entrepreneurial activity as a percentage of the adult population. For example, in Japan it dropped 65%; France, 57%; Italy, 42%; Germany, 35%; UK, 31%; and Canada, 22%. Collectively, activity in these six nations fell 39% after rising 8% between 2000 and 2001. However, in the U.S. activity fell only 9% from 2001 to 2002 -- after a much-steeper 30% drop-off in 2000-2001 -- suggesting a stabilization trend, says GEM project director Larry Cox. Entrepreneurial activity appears to reflect changes in national gross domestic product growth, say study authors. The study was conducted by Babson College, Babson Park, Mass., and London Business School, and was funded by the Ewing Marion Kauffman Foundation.