Drivers and Inhibitors of Entrepreneurship Development in Central and Eastern European Countries

This paper is aimed to identify key factors stimulating and hindering entrepreneurship development in the Central and Eastern European countries (country sample consists of Ukraine, Poland, Czech Republic, Romania, Hungary, Slovak Republic, Moldova, Bulgaria and Georgia; time horizon: 2006-2017). Set of dependent variables includes 6 indicators that characterize new business start-up intensity, stock market activity and entrepreneurship financial performance. Independent variables sample is built with 34 indicators, which allow to measure current state of social, economic and ecological environment, logistic infrastructure development, governance performance and ease of doing business. Empirical research is realized in Stata software package using panel data regression analysis (random-effects GLS regression). Research results can be summarized as follows: 1) governance performance has the greatest impact on entrepreneurship development, while changes in economic environment have no significant influence on it; 2) start-up business intensity mostly depends on social factors and governance efficiency; 3) stock market activity is hugely affected by environmental factors, conditions of doing business and governance quality; 4) entrepreneurship financial performance is likely to improve in respond to logistic performance strengthening. Thus, elimination of corruption, development of logistic infrastructure and increase of population with advanced education can be mentioned as core general drivers of entrepreneurship development in the Central and Eastern European countries, while inhibitors of entrepreneurial activity are specific for the certain perspective of it.