Empirical Insights Into the Macro Factors’ Impact on Aggregate Entrepreneurship in Least-Developed Countries

This study investigates macro factors influencing aggregate entrepreneurship in least-developed countries (LDCs). Panel data analysis methods were employed on a research sample of 32 LDCs during the period 2006 to 2019 to select the appropriate regression model, ultimately opting for the robust fixed-effects model. The research findings indicate that in LDCs, economic conditions such as GDP per capita and FDI play a decisive and positive role in stimulating aggregate entrepreneurship. However, factors such as GDP growth, international trade, and inflation show no significant impact on entrepreneurship. Social factors such as gross national expenditure, government spending on education, and inflation also do not significantly influence entrepreneurship, suggesting that broader social expenditures may not directly affect entrepreneurial activity in these contexts. Institutional entrepreneurial factors like the time required to start a business were found to have a significant negative impact on aggregate entrepreneurship, whereas the cost of business start-up procedures and the profit tax rate did not show significant effects on aggregate entrepreneurship in LDCs. These findings underscore the importance of practical economic conditions and financial regulation in driving entrepreneurship in LDCs.