University of Groningen Essays in Comparative International Entrepreneurship Research Kleinhempel, Johannes

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University of Groningen

Essays in Comparative International Entrepreneurship Research Kleinhempel, Johannes

DOI:

10.33612/diss.111582628

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Publication date: 2020

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Kleinhempel, J. (2020). Essays in Comparative International Entrepreneurship Research. University of Groningen, SOM research school. https://doi.org/10.33612/diss.111582628

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Essays in Comparative International

Entrepreneurship Research

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Publisher: University of Groningen, Groningen, the Netherlands

Printer: Ipskamp Printing, P.O. Box 333, 7500 AH Enschede, The Netherlands

ISBN: 978-94-034-2279-4 (Paperback) / 978-94-034-2280-0 (eBook)

All rights reserved. No part of this publication may be reproduced, stored in a retrieval system of any nature, or transmitted in any form or by any means, electronic, mechanical, now known or hereafter invented, included photocopying or recording, without prior written permission of the publisher.

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Essays in Comparative International

Entrepreneurship Research

PhD thesis

to obtain the degree of PhD at the University of Groningen

on the authority of the

Rector Magnificus Prof. C. Wijmenga and in accordance with the decision by the College of Deans. This thesis will be defended in public on Thursday 9 January 2020 at 16.15 hours

by

Johannes Kleinhempel

born on 20 July 1990 in Chemnitz, Germany

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Supervisor

Prof. S. Beugelsdijk

Co-supervisor

Dr. M.J. Klasing

Assessment Committee

Prof. S. Estrin Prof. J.H. Garretsen Prof. U. Stephan

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Acknowledgements

I am immensely grateful to the many people who have contributed to this thesis and the experience of writing it. To them, I would like to devote these first pages. First and foremost, I would like to thank my supervisors Sjoerd Beugelsdijk and Mariko Klasing. Sjoerd, thank you for your expert guidance, your constant support in all matters, academic and otherwise, and your contagious enthusiasm that has been a steady source of inspiration and motivation (and eased the process of “killing my darlings” in the manuscript). It has been a privilege to be your student. Mariko, thank you for sharing your deep knowledge and your keen eye for detail. Your persistent efforts have elevated this thesis and made me grow. It has been a pleasure to learn from both of you in these past three years; this thesis would not have come into existence without your insights and backing.

I am very grateful to Saul Estrin for intellectual guidance and many stimulating discussions. Your critical yet always constructive feedback, your continued support and encouragement, and the numerous learning opportunities you have awarded me have been –and continue to be– of invaluable importance.

I would like to express my gratitude to the committee members: Saul Estrin, Harry Garretsen, and Ute Stephan. I highly appreciate your time and willingness to evaluate this thesis as well as your suggestions and guidance for the future. Thank you for your career support in the last stages of the PhD, Harry, and thank you for the engaging and though-provoking conversations, Ute.

The collaborative and stimulating environment at the University of Groningen has been a fantastic place to learn. In particular, I would like to thank Viola Angelini, Arjan Fredericks, Samuele Murtinu, Robbert Maseland, Milena Nikolova, Florian Noseleit, Andreas Rauch, Christopher Schlägel, and Michael Wyrwich for interesting conversations, helpful feedback, and practical input. You have not only strengthened this thesis substantially but also made the process of writing it more fun. I am also grateful for the administrative support of Arthur, Ellen, Kristian, and Rina and the practical backing of the GEMMIES Astrid, Herma, Jenny, and Sylvia.

Writing this PhD would not have been the same without the fantastic group of friends with whom I shared this experience. Juliette, we have been together in this journey for the last five years, since ‘day zero’ of the Research Master, and I am grateful for your friendship. Your kindness, empathy, and enduring support have been invaluable and I have learned a lot from you. While I will always miss having you in the same office, I am looking forward to many years ahead. I would like to express my gratitude to Maite, for being quintessentially a cool person, for caring so deeply about others, and for bringing ‘Team GEM’ closer together; to Tobi for many conversations, light-hearted and serious, and for generally being a rockstar; to Daan for your uncanny humour and Stata wisdom; to Nick

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for being both a volleyball and econometrics hero; to Jos for brightening any conversation; to Stefan, Ferdinand, and Nikos for sharing rather particular music tastes and being awesome in general; and to team sports: I am both saddened and relieved –as I am sure you are– that I won’t be seeing the volleyball field anytime soon. Thank you, Christian, Daniel, Duc, Fred, Gianmaria, Joeri, Mart, Romina, Sarah, Timon, Vincent, the 9th_{floor, and}

the GEM PhDs: It has been as much of a pleasure to be able to ‘talk shop’ with you as it has been to do exactly the opposite. I also want to thank Marianna for having been the best office mate one could have wished for.

I would like to extend my heartfelt gratitude to my family and friends:

To my friends, you know who you are and how important you are to me. I am grateful for your friendship and I am looking forward to sharing scrambled eggs, curry-potatoes, proper Amatriciana, and Reudnitz’ finest with you.

To my family, for there is no place like home because of you. Ich bin euch unendlich dankbar fur eure –wortwörtlich– grenzenlose Unterstützung. Meinen Eltern Jan und Anett, meiner Lieblingsschwester Isa, und meinen Großeltern Horst und Uschi und Siegfried und Erika ist diese Arbeit gewidmet.

Last but not least, to Laura, for sharing all the highs and lows, not just during this academic journey, but –more importantly– in life. Your positivity, calmness, and dangerously witty humour brighten any day and I am looking forward to the future with you.

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I

List of Tables

Table 2.1: Summary statistics 49

Table 2.2: Individual-level correlation table 50

Table 2.3: Regional-level correlation table 50

Table 2.4 Intra-class correlation coefficients 51

Table 2.5: Multi-level logistic regression on the likelihood of transitioning through the

venture creation process 54

Table 2.6: Multi-level logistic regression on the likelihood of transitioning through the

venture creation process for different kinds of social capital 55

Table 2.7: Robustness analyses 59

Table 3.1: Descriptive statistics and definitions of variables 95

Table 3.3: Aggregate-level correlation table 97

Table 3.4: Multi-level logistic regressions on second-generation immigrants'

individual-level entrepreneurship status 101

Table 3.5: Multi-level logistic regressions – Alternative measure of entrepreneurial

culture 103

Table 3.6: Multi-level logistic regressions – Alternative types of entrepreneurship 105 Table 3.7: Multi-level logistic regressions – Assessing robustness to alternative

explanations 108

Table 3.8: Multi-level logistic regressions – Falsification check 112

Table 4.1: Theoretical channels through which culture influences entrepreneurship 127

Table 4.2: Descriptive statistics and definitions of variables 145

Table 4.3: Sample break down and country-of-ancestry scores for aggregate

entrepreneurial traits 147

Table 4.5: Aggregate-level correlation table 148

Table 4.6: Multi-level logistic regressions on second-generation immigrants'

individual-level entrepreneurship status – Aggregate entrepreneurial traits 150

Table 4.7: Multi-level logistic regressions – Assessing the robustness to alternative

perspectives on culture and entrepreneurship 154

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V

List of Figures

Figure 1.1: Self-employment rates across countries 3

Figure 1.2: Persistent differences in self-employment rates across countries 3

Figure 1.3: Within- and across-country variation in current self-employment rates in

Europe 4

Figure 1.4: Persistent differences in self-employment rates across European sub-national

regions 5

Figure 1.5: Differences in current self-employment rates across immigrant groups 6

Figure 1.6: Persistent differences in self-employment rates across immigrant groups 6

Figure 2.1: The venture creation process 38

Figure 2.2: Modeling the transitions of the venture creation process 42

Figure 2.3: Regional social capital in the European regions 43

Figure 3.1: Conceptual challenges in studying the macro-level determinants of

entrepreneurship 79

Figure 3.2: Empirical approach of alternative identification strategy 94

Figure 3.3: Estimated country-of-ancestry effects (marginal effects) 99

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VI

List of Appendices

Supplementary Results Table R1: Sequential logit model – Likelihood of transitioning

through the venture creation process 168

Supplementary Results Table R2: Sequential logit model – Connected and isolated

regional social capital 169

Supplementary Results Table R3: Sequential logit model – Robustness checks 170

Supplementary Results Table R4: Variance partition coefficients / intra-class correlation

coefficients 171

Supplementary Results Table R5: Country fixed effects 172

Supplementary Results Table R6: Alternative random term structure to account for

nesting 174

Supplementary Results Table R7: Robustness checks on baseline 176

Supplementary Results Table R8: Variance partition coefficients / intra-class correlation

coefficients 183

Supplementary Results Table R9: Different types of entrepreneurship: Incorporated and

unincorporated self-employment 185

Supplementary Results Table R10: Assessing the robustness to non-cultural effects and

ancestral-group level (dis)advantages 189

Supplementary Results Table R11: Empirical robustness checks 193

Data Appendix Table D1: Country of ancestry breakdown 198

Data Appendix Table D2: Country of ancestry descriptive statistics 198

Data Appendix Table D3: European Social Survey summary statistic and variable

overview 201

Data Appendix Table D4: Additional variables 202

Data Appendix Table D5: Second-order factor solution of cultural descriptive norms 209

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University of Groningen Essays in Comparative International Entrepreneurship Research Kleinhempel, Johannes

Essays in Comparative International

Entrepreneurship Research

Essays in Comparative International

Entrepreneurship Research

PhD thesis

Johannes Kleinhempel

Supervisor

Co-supervisor

Assessment Committee

Acknowledgements

Table of contents

List of Tables

List of Figures

List of Appendices