The Role of Knowledge in Business Start-up Activity

Drawing on the literature on knowledge and self-efficacy, we examine the effects of individuals’ possession of and exposure to knowledge on the likelihood to engage in business start-up activity. Our analyses are based on data collected for the 2002 Global Entrepreneurship Monitor. More specifically, we analysed data from individuals located in Belgium and Finland in terms of their education and skills, and their contacts with the entrepreneurial community. Our findings suggest that knowledge-based factors indeed have a strong impact on the decision to engage in business start-up activity. We also found cross-country differences for these knowledge-based effects, in particular as regards the growth-orientation of business start-up activity. We discuss our findings and provide directions for future research.

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