Business Environment Of Entrepreneurship

Using a comparison of one of the leading economies of the developed world i.e. the U.K, and an emerging economy like Mexico which is a MINT member (Mexico, Indonesia, Nigeria and Turkey), this research will look at the business environment and its effect on entrepreneurship in these two extremities. The reason behind the selection of Mexico is that it is projected to have a higher GDP per capita than most European economies. The research will analyse the external business environment which is also called contextual or general environment. This is made up of the economic, political, legal and social aspects. This will be combined with data analysis of inputs of business which are the costs, bureaucracy, expenditure on R&D as a percentage of GDP, public attitudes and perceptions of entrepreneurship and their business environment. This paper will aim at showing that high costs and heightened levels of bureaucracy as well as costly regulations deter or slow the creation of new firms.

Keywords

Entrepreneurship; Business incorporation; Business environment; institutions; procedures, Regulation

1. Introduction

In today’s ever changing economy, people are now more accepting of entrepreneurship as a career. Although many entrepreneurs state different motivations for starting a new business such as passion, career freedom, a cause or profit they all face the same financial, regulatory and legal obstacles.

These obstacles are part of the business environment and a modern business will need to go through these things because it doesn’t function in isolation. A business is a an economic and social part of the society therefore as it endeavours to achieve its economic goal it must do so while satisfying the interests of society, industry an...

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...ies with high frim entry rates benefit entrepreneurs with fewer procedures, simplified legal forms, reduced red tape, stable political climate and good governance which can in turn improve innovation and competition. (Klapper et al. 2009). (Akin, 2010) states that the entrepreneur is the main factor of a country’s economic development and that efficient institutional structures that form part of the country’s business environment determine the success of the entrepreneur. However (Beck et al; 2005) argue that the business environment view is not solely on the entrepreneur, but on the whole business environment affecting all forms of business large medium and small. Both agree that entrepreneurship is linked to growth and employment and that if entrepreneurial activities are restricted intentionally or unintentionally growth and employment will be adversely affected.