International Journal of Business and Economics Volume 21, No. 2 September, 2022

Analogous Relationship Between International Rankings by Entrepreneurship and Human Development Indexes

Maniyalath Narendranathan

Faculty of Clinical Epidemiology, Medical College, Trivandrum

Roshni Narendran

Lecturer in Entrepreneurship and Innovation, Tasmanian School of Business and Economics, University of Tasmania, Australia

Abstract

This study empirically examines the hypothesis of equality of the measures of entrepreneurship and human development by evaluating the Global Entrepreneurship Index (GEI) and the Human Development Index (HDI) for 2016 and 2017 through method comparison analysis. There were no systematic or proportional differences in the ranking of nations by the two measures. A validation analysis shows that the two indices are highly correlated identical predictors of other entrepreneurship variables. Thus, HDI can replace GEI as an entrepreneurship measure. Moreover, this study highlights issues in nations’ rankings. The implication for policymakers is to exercise caution in interpreting such rankings and in evaluating policy effects by observing the changes in rankings over a period of time. Our study, which establishes a positive relationship between entrepreneurship and human development, emphasises the need for increasing the specificity of entrepreneurship measures, otherwise these indices become mere measures of human development.

Keywords：Global Entrepreneurship Index, Human Development Index, Ranking of Nations By Indices, Passing–Bablok Regression, Bland–Altman Analysis.

JEL Classifications：E01, L26, O15.

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