Hard or Easy? Difficulty of Entrepreneurial Startups in 107 Climato-Economic Environments

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Abstract

Driven by existential needs for thermal comfort, nutrition, and health, human populations create cultural adaptations to environmental conditions. Entrepreneurs starting new businesses in more threatening or more challenging environments may be a case in point. In a secondary analysis of population-level data from 107 nations, we cross-sectionally examined six adaptation hypotheses based on climato-economic theorising. The regression results show that new business creation is experienced as being the hardest in the threatening environments of poorer countries with colder winters and cooler summers (e.g. Bolivia and Ukraine), and as being the easiest in the challenging environments of richer countries with hotter summers and warmer winters (e.g. Singapore and United Arab Emirates). Rival explanations in terms of the historical trajectory of state emergence (state antiquity, colonial past, communist past) and societal development (industrialisation, democratisation, education) are ruled out and discussed. This article suggests that results of individual-level and group-level research into entrepreneurship are tentative at best as long as cultural adaptations to climato-economic environments are left out of consideration.

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