Screening item effects in estimating the prevalence of nascent entrepreneurs

The use of human population surveys to estimate the prevalence of nascent entrepreneurs has become a major feature of both longitudinal studies of the firm creation process, such as the US Panel Studies of Entrepreneurial Dynamics (PSED) research program, as well as cross-national comparisons, as reflected in the Global Entrepreneurship Monitor (GEM) initiative. The basic procedure has been to use interview screening items to locate individuals that may be considered candidate nascent entrepreneurs; other criteria are then used to identify those considered active nascent entrepreneurs. In these human population surveys, little attention has been paid to the potential impact of variations in wording in the initial screening items, either across time in the same language or in different languages, on the final prevalence rates. Analysis of 134 independent samples in the US over the 1993-2006 period, where different screening items were employed, indicates a major impact of item wording. Once adjustments to account for item variation were made, there was no statistically significant change in the prevalence of active nascent entrepreneurs, from 5 to 6 per 100 over the 1998-2006 period. This pattern of temporal stability is consistent with three other national programs measuring U.S. new firm creation activity.