Edited by Kevin Hindle and Kim Klyver
Friederike Welter and David Smallbone INTRODUCTION This chapter is concerned with new venture creation in economies which until recently were operating under central planning. Whilst they are often described collectively as transition economies, the evidence presented below demonstrates that they cannot be treated as a homogeneous group from an entrepreneurship development and new venture creation perspective. During the socialist period, private entrepreneurship was regarded as an illegal activity in the former Soviet republics, although certain forms of entrepreneurship were tolerated in many Central and East European countries, as discussed below. Since the collapse of the Soviet Union in 1989, all of the former Soviet republics have at least tolerated entrepreneurship (although, based on government actions in some countries, entrepreneurship is barely accepted), with countries in Central and Eastern Europe actively encouraging it. Essentially, the stance adopted by governments towards private enterprise during the post-socialist period tends to reflect their commitment to the wider processes of market reform, with the path to EU accession as a key driver in Central and East European countries. Since most research on new venture creation has focused on mature market economies, a key question concerns the extent to which differences can be observed in the process of new business creation in transition environments and to what extent socialist experiences are of importance for today’s entrepreneurship. These questions are potentially of wider interest because they focus on the relationship between venture creation and the external environment in which it occurs. The extent to which the processes...
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