Study: Korea`s Entrepreneurial Spirit Fell to 16th Last Year

Korea’s entrepreneurial spirit ranked 16th among 32 countries last year, with start-up companies under 3 1/2 years old ranking 28th, the results of a survey released Monday said.

The Entrepreneurial Spirit Center of Future Strategy Research Institute at The Dong-A Ilbo and Deloitte Consulting conducted a joint study measuring the entrepreneurial spirit of 32 countries. They were 28 member countries of the Organization for Economic Cooperation and Development with a population of more than a million and Brazil, Russia, India and China.

The survey was the first by a Korean media company on cross-country comparison of international competitiveness in entrepreneurial spirit.

The U.S. ranked first, followed by Sweden, Switzerland, Finland and Denmark. In Asia, Japan ranked eighth and China 19th.

The survey was based on corporate activity, market climate and government conditions.

A time series analysis showed Korea fell from 11th in 2000 to 14th in 2005 and 16th last year. The decline was mainly due to the high rate of startups formed for livelihood compared to those pursuing business opportunities, leading to a decline in quality startups.

Korea ranked eighth in fostering personnel competence, but only 29th in securing staff.

The U.S. remained No. 1 for the tenth straight year on the back of favorable fundraising conditions and hiring. European countries including Finland and Sweden have also remained among the list`s elite every year.

Donna Kelley, associate professor of entrepreneurship at the U.S.-based Babson College, said “The Korean government needs to encourage potentially innovative businesses to build confidence in starting a business. Education for those preparing a business and plans to vitalize business communities should also be steadily promoted.”