The determinants of the growth expectations of the early-stage entrepreneurs (TEA) using the ordinal logistic model (OLM): the case of Turkey

Abstract

This study uses the Ordinal Logistic Model (OLM) to analyze the determinants of the growth expectations of total early-stage entrepreneurship activity (TEA) expressed in terms of new jobs to be created within their firms in four categories. Specifically, given the increasing importance of entrepreneurship in job creation, innovation and economic growth, we try to inquire into the question of why some of the new entrepreneurs and not the others expect a rapid development of their ventures. The data from the Global Entrepreneurship Monitor (GEM) for the years 2006-2008 for Turkey were employed. Our findings indicate that the personal characteristics of the early-stage Turkish entrepreneurs such as gender, education and household income, in addition to their motivation and current size of their businesses are important factors in resolving the prevalence of high-expectation new firms. Moreover, some scenarios particular to some sub-groups or population cells of Turkish developing entrepreneurs which may create the bulk of high-expectation entrepreneurial pursuit were conducted using OLM. As far as the policy implications are concerned, the availability and access of capital funding to early-stage entrepreneurs and an education system more relevant to today’s competitive world might both contribute better to Turkish economy’s prosperity, and seems to be very important for policy considerations.