The European Index of Digital Entrepreneurship Systems (EIDES), as a composite measure, responds to the need for a tool to better understand and appraise the extent of the digital entrepreneurial ecosystem. Specifically, the EIDES is an attempt to measure both physical and digital conditions for stand-up, start-up and scale-up ventures in EU countries and the UK.
The structure of the revised EIDES encompasses four pillars for the General Framework Conditions (i.e. Culture and Informal Institutions, Formal Institutions, Regulation, and Taxation, Market Conditions and Physical Infrastructure) and their associated digital counterparts. Specifically, each framework condition can be digitalised with a suitable measure of a corresponding digital context obtained made by variables that reflect the digitalisation of each specific framework condition. Consequently, two versions of each framework condition appear in the index: a non-digitalised version and a digitalised one.
In addition to the General Framework Conditions, the EIDES also measures 'systemic' framework conditions which are the resource-related conditions with a direct effect on the entrepreneurial dynamic in a given country or region. In practical terms, businesses require a range of different resources (i.e. Human Capital, Knowledge Creation and Dissemination, Finance, and Networking and Support) in order to scale up successfully. These resources are not substitutable against one another. Therefore, the Systemic Framework Conditions have to come together to help ‘co-produce’ the system outcomes.
In the EIDES' theoretical structure the General Framework Conditions apply broadly to entrepreneurship, while the Systemic Framework Conditions act differently across three stages of the entrepreneurial development: stand-up, start-up, and scale-up. The Stand-up stage relates to the self-selection of individuals into entrepreneurship. The Start-up stage is the subsequent creation of new start-ups. The Scale-up stage concerns the scaling up of the start-ups that discovered a business model with high-growth potential. Accordingly, the EIDES includes three sub-indices for each Systemic Framework Conditions plus their digital versions calculated with measures of the corresponding digital contexts.
The value of the overall EIDES is the average of both General and Systemic Framework Conditions. This approach possibly provides a helpful portrayal of national systems of entrepreneurship. In each national system of entrepreneurship, general framework conditions regulate how the systemic conditions can realise their full potential and co-produce the national entrepreneurial dynamic. The approach underlying the EIDES also distinguishes between digital and non-digital conditions to proxy the effect of digitalisation on systems’ abilities to facilitate high-quality entrepreneurial dynamic. Furthermore, declining the systemic conditions across three entrepreneurial stages allows for even more fine-grained policy insights.
EIDES methodology and country ranking reports: