Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/330316 
Year of Publication: 
2025
Series/Report no.: 
ZEW Discussion Papers No. 25-052
Publisher: 
ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung, Mannheim
Abstract: 
This paper replicates and extends the framework of Guzman and Stern (2020) to examine the evolution of entrepreneurial activity in Europe, focusing on France, Germany, and the United Kingdom between 2009 and 2023. Using harmonized national business registry data, we construct measures of both the quantity and quality of entrepreneurship across regions. In particular, we adapt the Entrepreneurial Quality Index (EQI), the Regional Entrepreneurship Cohort Potential Index (RECPI), and the Regional Entrepreneurial Acceleration Index (REAI) to capture the number of new ventures, their ex-ante growth potential, and the extent to which ecosystems translate this potential into realized outcomes. Our findings support the generalizability of this framework in the European context while revealing substantial heterogeneity across countries and regions. Major metropolitan centers such as Paris, London, and Munich combine high rates of entry with high entrepreneurial quality, but smaller knowledge- and research-intensive regions - including Cambridge, Oxford, Bonn, and Heidelberg - also emerge as important hubs. With respect to ecosystem performance, France and the UK initially exceeded expectations but later experienced steady declines, whereas Germany maintained relatively stable performance, with notable overperformance between 2012 and 2016. Moreover, we find a stronger positive correlation between entrepreneurial quantity and quality in Europe, suggesting that ecosystems capable of generating more start-ups are also more likely to produce high-quality firms. This study provides important insights for the comparative analysis of entrepreneurial ecosystems and builds a foundation for designing policies aimed at fostering high-quality, innovation-driven entrepreneurship in Europe.
Subjects: 
Entrepreneurial Quality
Entrepreneurial Ecosystem
High-Growth Firms
Regional Innovation
JEL: 
G24
G32
L25
L26
M13
R12
Document Type: 
Working Paper

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