Z. Silenas. Entrepreneurship in Europe: a matter of attitude

This year European Commission highlighted 1Y0-A19 the need for more entrepreneurs in order to return the EU to economic growth and higher levels of employment. Promotion of self-employment and entrepreneurship is correctly seen as way forward. How could this be achieved?

One such factor would be a general perception of entrepreneurs by society. In other words, much fewer capable people ever choose occupations which are not well accepted by other people. And in fact there are a number of insights that try to suggest that Europeans are generally less business-friendly than, for example, the Americans.

But the EC data shows that currently 87% of Europeans agree that entrepreneurs are job creators and 79% believe that entrepreneurs create new products that benefit all. More importantly these numbers have remained stable between 2009 and 2012. Of course, there was a slight 1Y0-A18 increase in number of people disgruntled with entrepreneurs. The proportion of people who think that entrepreneurs exploit other peoples’ work did rise from 49% to 57% in 2012.

This may seem somewhat strange given the politicians’ pandering to the left, or the recent protests. But it seems that for all the talk about the fall of capitalism, people have not profoundly changed their minds about what creates wealth in society. It looks like at least for now people in Europe won’t be chastised for choosing business as their occupation. But could the negative rhetoric have detrimental effects in the future?

One such region of the world which was awash with anti-business rhetoric is the post-Soviet countries. It should be recalled that being a businessman was a criminal offence punishable by up to seven years in prison.

On one hand, this region seems even more business-friendly that the old Europe. Six out of ten post-Soviet states are disproportionally occupying the spots among European countries where respondents were among the most keen to become self-employed, EC data shows. One the other hand, the old socialist dogma of entrepreneurs being an exploiter of other people is also slightly more pronounced than in the west.

The research carried out by Lithuanian Free Market Institute (LFMI) and its partners in four distinct post-Soviet countries (namely Lithuania, Bulgaria, Georgia, Kyrgyzstan) shows that New EU Member States Lithuania and Bulgaria tend not to trust entrepreneurs. Only a third of Lithuanians (31%) trust entrepreneurs, whereas in Bulgaria only one fifth (19%) of citizens do so. Moreover, 67% of Lithuanians and 69% Bulgarians agree or tend to agree with the statement that “Entrepreneurs get rich by exploiting other people’s work”.

The research by LFMI reveals yet another interesting tendency. The further east you go, the more people want to become entrepreneurs – with 34 percent of respondents agreeing to the notion in Lithuania and 21 percent in Bulgaria, compared with 54 percent of respondents agreeing to the notion in Georgia and 59 percent in Kyrgyzstan. But even these countries are no match for China, where 68 percent of respondents would want to be self-employed (according to EC data). Obviously it can’t be geography triumphing over history.

This seemingly contradictory evidence is not really contradictory. Europe does have excellent traditions in enterprise, and lean towards the left that began after the Second World War should be treated more as an exception rather than the defining features of the European business model. Self-reliance, private initiative is as European as culture or history that Europeans feel so exceptional of. And if post-Soviet countries managed to sweep aside half a century of indoctrination about evils of private enterprise, Europeans can easily overcome the brief periods when markets seem to be the problem rather than a solution to economic issues.

Data used in the current comment:

Flash Eurobarometer 354 Entrepreneurship in the EU and Beyond.

Study The Profile of the Entrepreneur in Post-Communist countries. This research by LFMI and its partners was made possible through the support of the John Templeton Foundation.