Understanding entrepreneurial behavior for predicting start‐up intention in India: Evidence from global entrepreneurship monitor (GEM) data

• Published date: 01 February 2022
• Author: Jabir Ali,Zakia Jabeen
• Date: 01 February 2022
• DOI: http://doi.org/10.1002/pa.2399

ACADEMIC PAPER

Understanding entrepreneurial behavior for predicting start-up

intention in India: Evidence from global entrepreneurship

monitor (GEM) data

Jabir Ali

1

| Zakia Jabeen

2

1

Economics and Business Environment, Indian

Institute of Management, Jammu and Kashmir,

180016, India

2

ICBM-School of Business Excellence,

Hyderabad, India

Correspondence

Jabir Ali, Economics and Business

Environment, Indian Institute of Management,

Jammu and Kashmir, India.

Email: jabirali@live.in

This study aims at identifying the factors affecting individuals in establishing start-

ups in India using the theory of planned behavior based on the Adult Population Sur-

vey (APS) of the Global Entrepreneurship Monitor (GEM) of 2016. Out of 3,400 indi-

viduals surveyed, 26.5% have reported new start-up efforts and 8.3% reported start-

up ownership. Attitude toward entrepreneurship, subjective norms, and perceived

behavioral control have significant effects on establishing start-ups in the country.

The findings of the study support the application of the theory of planned behavior

in the Indian context and provide practical policy implications of these results for

strengthening start-up efforts in the country through various public and private initia-

tives. This study provides a clear mapping of potential individuals who are the most

likely to start a business on the one hand and identification of factors, which may

affect the start-up intention on the other.

1|INTRODUCTION

Entrepreneurship is widely known to be instrumental for economic

growth and technological progress and inviting attention across the

world (Fellnhofer & Kraus, 2015; Frank, Lueger, & Korunka, 2007;

Mat, Maat, & Mohd, 2015). Start-ups are the entrepreneurial ventures

in the initial business stage, which hold the keys to technological inno-

vation and economic growth (Friar & Meyer, 2003; Lindholm-

Dahlstrand, Andersson, & Carlsson, 2019). Subrahmanya (2015)

argued that technology entrepreneurship, leading to high growth

technology start-ups, is assuming increasing importance worldwide as

a key to economic development. Acs and Armington (2006) empha-

sized that venture creation has been statistically linked to both job

creation and regional development, and, therefore, promoting start-

ups is the potential option for the Indian economy. Entrepreneurship

is regarded as the most important phenomenon resulting in employ-

ment generation in all the sectors globally, along with promoting crea-

tivity and innovation, leading to socio-economic welfare (Acs,

Desai, & Hessels, 2008; Trivedi, 2017). Reynolds, Bygrave, Autio, and

Arenius (2004) defined entrepreneurship as an economy adjuster with

the help of several courses of action. Similarly, Rault and Mat-

hew (2019) argued that the rapid development of various institutions

and incubation centers supporting new business creation in India has

the potential to generate economic growth, innovation, and economic

development, and suggested that the role of entrepreneurship policies

need to shift its focus and resources towards the building of a more

inclusive start-up ecosystem.

There are ample pieces of evidence on the entrepreneurial pro-

cess and factors affecting entrepreneurship development in most of

the sectors of the economy, addressing various issues in developed

and developing nations. Empirical shreds of evidence indicate that

behavior and attitude of an individual significantly affect the entrepre-

neurial intention across the globe (Barazandeh, Parvizian, Alizadeh, &

Khosravi, 2015; Dileo & García Pereiro, 2018; Hechavarria &

Ingram, 2016; Lam, Harris, & Sen Yang, 2019; Maden, 2015; Micozzi &

Lucarelli, 2016). Hwee Nga and Shamuganathan (2010) analyzed the

influence of personality traits and demographic factors on social

entrepreneurship start-up intentions. Frank et al. (2007) examined the

significance of personality in business start-up intentions, start-up

realization, and business success. Many studies have investigated the

antecedents of entrepreneurial intentions using the theory of planned

behavior, which focuses on attitudes as the best predictors of intent

toward the act, social norms, and perceived behavioral control

(Ferreira, Raposo, Rodrigues, Dinis, & do Paço, 2012; Krueger, 2000;

Received: 3 May 2020 Revised: 30 May 2020 Accepted: 13 August 2020

DOI: 10.1002/pa.2399

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https://doi.org/10.1002/pa.2399