Erasmus University Rotterdam Rotterdam School of Economics Master of science degree in Economics & Business: Entrepreneurship, Strategy and Organization Economics Master of Science Thesis Topic: Small Business Economics Title: Explaining Entrepreneurship in underdeveloped countries of The Great Lakes region of Africa: what are the factors that favor or hinder entrepreneurship? Evidence from Burundi. Student: Antoine Kabura
[email protected] Supervisor: Dr Ingrid Verheul March 2006 Rotterdam, The Netherlands Explaining Entrepreneurship in underdeveloped countries of The Great Lakes region of Africa: What are the factors that favor or hinder Entrepreneurship? Evidence from Burundi Abstract This paper is based on the assumption that entrepreneurship contributes to the economic development of a nation. Building on the determinants of entrepreneurship proposed in the Eclectic Theory of Entrepreneurship by Verheul et al. (2002), and following the Framework of determinants of entrepreneurship by Wennekers et al. (2002), the paper tries to point out to what extent economic growth in underdeveloped countries of The Great Lakes Region of Africa can be sustained through the economic phenomenon of entrepreneurship. An attempt is specifically made to bring to light the factors that hinder or favor entrepreneurship in Burundi. 1 Table of content 1. Introduction 3 2. Defining Entrepreneurship 5 3. Measuring Entrepreneurship 7 4. Entrepreneurship and Economic Growth 8 4.1 Introduction 8 4.2 Defining and measuring Economic growth 8 4.3 Role of Entrepreneurship in Economic growth 8 4.4 Mechanisms by which Entrepreneurship leads to economic growth 9 4.5 Conclusion 10 5. Determinants of Entrepreneurship 11 5.1 Introduction 11 5.2 Demand and Supply sides of Entrepreneurship 11 5.3 The model 11 5.4 Conclusion 16 6.