For many years, scholars have highlighted the critical importance of entrepreneurship in economic development. While recognition of this view increased, understanding of the entrepreneurial process remained poor; policymakers struggled to formulate effective and appropriate policies to nurture the phenomenon to the national advantage. This failure was due in no small measure to the lack of reliable, internationally comparable data. This is where GEM comes in.
GEM collects world-class data on entrepreneurship, and uses it to identify policies that can increase the level and quality of entrepreneurial activity.
In GEM National Reports, GEM research is translated into concrete policy suggestions. Every year, National Teams analyse the results of the Adult Population Survey (APS) and the National Experts Survey (NES) in their country, using the information gathered to produce a National Report. The reports provide a detailed overview of the national entrepreneurial landscape and offer policy recommendations, taking into account national characteristics. National Report launches are eagerly anticipated events, often attended by key policymakers and officials, garnering significant media interest. Following the launch, the reports are widely distributed in physical and electronic format to government departments and agencies.
Furthermore, GEM enables reliable cross-country comparisions - so policymakers can compare their country with similar countries and discover which policies are working elsewhere.
In many countries, government agencies and other influential figures regularly cite data from GEM National Reports in their own reports and policy papers.
In Finland, the Ministry of Employment and the Economy use GEM data in their bi-annual ‘Entrepreneurial Activity’ reports; parts of the Finnish National Report are also embedded in the Ministry’s annual ‘Entrepreneurship Review’. In the USA, the GEM report is regularly consulted by White House officials; Representative Carolyn Maloney used GEM data in her official press release for the “Start-Up Visa Act of 2010”, a bill she introduced to the House of Representatives.
GEM National Teams are also commissioned by government agencies to produce special reports.
These reports mine the rich GEM dataset to provide information and policy recommendations on particular aspects of a country’s entrepreneurial climate. The GEM UK team have produced a variety of regional and special topic reports for different government departments; in Spain, the Ministry for Equality commissioned a GEM report to help design measures to advance business development based on gender equality criteria.
GEM National Teams are considered experts in entrepreneurship research and are consulted directly by government agencies when formulating policy.
Many GEM teams have built a strong reputation for the project in their country, and have forged close links with those in charge of policy towards entrepreneurship. The Croatian GEM team works closely with the Ministry of Economy, Labour and Entrepreneurship, interpreting the GEM results and helping to ensure that Croatia fulfils the requirements of the EU Charter on SMEs, as part of its bid to join the European Union.
Government agencies use GEM measures as targets for development and improvement.
In the Netherlands, the Ministry of Economic Affairs, Agriculture and Innovation set a target: for the country to be among the EU’s five top-scoring Member States in terms of early-stage entrepreneurship by 2010. This goal was achieved in 2009.
As GEM has grown in size and reputation, establishing itself a significant contributor to national and global debates about entrepreneurship, we have begun to see positive shifts in policy towards entrepreneurship around the world:
In South Africa, GEM reports have long highlighted government red tape as a primary limiting factor for entrepreneurs. In his medium-term budget policy statement in October 2010, the South African Minister of Finance indicated that new laws will need to ensure that the onerous regulatory burden on small and micro businesses is reduced. He has committed to ensuring that rules friendly to small businesses are implemented across all regulations – tax, company registration, labour and zoning – to minimise compliance burdens and costs.
In Chile, the government recently granted tax exemption on capital gains to venture capital investors - an initiative that can be linked to the GEM results. Since 2003, GEM Chile National Reports, which are widely consulted by the Chilean government, have consistently highlighted finance as one of the primary constraints to the entrepreneurial system in Chile.