The conceptual model also depicts the impact of the basic requirements, efficiency enhancers and the EFCs on attitudes, activities and aspirations of entrepreneurs as they create jobs, innovate and assist in the socio-economic development of their respective countries. Kelly et al (2012) assert that the determinants of entrepreneurship are complex and the extent to which specific variables can be tied to the rate or profile of entrepreneurship in a country is not clearly understood. Therefore, a study of the institutional environment is critical to an understanding of entrepreneurship because it enable entrepreneurs to better interpret the conditions under which they must operate and sets the stage for policy makers to address critical issues.
The Adult Population Survey (APS) is used to measure the second stage of the model. Each participating country conducts a survey of a random representative sample of at least 2 000 adults (aged 18 – 64 years). The surveys are conducted at the same time of year (generally between April and June) using a standardized questionnaire provided by the GEM consortium. The APS is generally conducted by an independent research vendor, chosen by each country’s GEM team based on the evaluation of the vendor’s research proposal. The raw data is sent directly to the GEM data team for checking and uniform statistical calculations before being made available to the participating countries. The data from the APS then provides details about the level of entrepreneurial activities in the country, the attitudes, perceptions and aspirations of the individuals as well as other information that can be used to develop a clearer picture about the state of entrepreneurship in a nation.
As stated in the GEM 2011 Global Report, the outcome of the model is national economic growth, innovation and job creation. The GEM data collection efforts allow for an exploration of the role of entrepreneurship in national economic development. GEM’s ability to map this grows with each annual cycle as combined sample sizes grow and as trends over time become apparent. (Bosma et al. 2012)
THE PHASES OF ENTREPRENEURSHIP The GEM Model recognizes three phases of entrepreneurial activity; namely starting a new business, running a new business or running an established business, and discontinuing a business. It is argued however, that these phases are not necessarily linear, that is, that one stage always leads to another. It is possible that an individual may stall at any stage of the process. 21 | P a g e