Key Finding

2. Entrepreneurs at the micro level need good economic policies at the macro level

The sub-indexes measuring Economic Fundamentals and Entrepreneurship and Innovation are more highly correlated with each other than they are with any other sub-indexes. We know this by comparing their scores, which are shown in the graph below. Of the top 20 most entrepreneurial and innovative countries in the Index, 17 are also among the top 20 countries with the strongest economic fundamentals.

INSIGHT: When countries create environments ripe for business start-ups and friendly to innovation, they are also doing the kinds of things that engender stability and growth in the overall economy. Without sound economic policy, entrepreneurship may very well hit a "ceiling". Countries may be innovative without having the highest health standards, for example, but they generally will never be innovative with a perpetually unsteady economy.