MEASURING ENTREPRENEURSHIP: A LETTER TO THE ECONOMIST (February 26, 2011)

As you point out, there are many indices that measure business environments across the globe: the Heritage Foundation’s index of economic freedom, the World Bank’s index of red tape, The Economist Intelligence Unit’s index of business environments, Transparency International’s index of corruption, the World Economic Forum’s index of international competitiveness, and the Global Entrepreneurship Monitor’s index of breeding new businesses (“Uncorking Enterprise,” February 26, 2011). But now you show some enthusiasm about the global entrepreneurship and development index concocted by Zoltan Acs of George Mason University in Virginia and Erkko Autio of Imperial College Business school in London, which is about to be unveiled. And all this because “policymakers are desperate to promote enterprise” around the world. I wonder whether another index would help them very much, though. If hints are needed, the existing indices can provide them either singly or jointly. What policymakers need are good advisers with entrepreneurial credentials. Measuring entrepreneurship, fickle as it happens to be, is what they would surely advise against in the first place.  It is a bit like measuring humor.