Entrepreneurship Development and the Role of Economic Transition in Entrepreneurial Activities in China

This study aims to elaborate on the entrepreneurship development in China and the role of China’s economic transition in Chinese entrepreneurial activities. We address China’s institutional transition environment, which is argued as the necessary condition of entrepreneurship development and the ‘incubator’ of three generations of entrepreneurial activities. We make use of a panel dataset from 31 provinces in China in the past 4 years. Our results show that China’s economic development has a significant inversed U-shaped impact on entrepreneurship development in China’s transitional stage from an efficiency-driven to an innovation-driven economy. Further findings in the recent transitional stage show that education resource and regional economic openness respectively has significantly positive impact on entrepreneurship. The interactive effects of education resources and economic openness were also found to be significantly positive. We show that the fact of China’s entrepreneurship development is approaching to the opportunity-oriented polar in recent years.