Enterprise and Small Business Principles
Explanations for the changes in business ownership
Given the heterogeneity of changes in business ownership rates over the last 30 or so years, it is unlikely that there is a unique explanation for such changes. The evidence from the previous section clearly showed that being above or below the average rate for all 23 countries does not necessarily indicate the likely direction of change in the rate of business ownership. Countries such as Japan and France were above the average but subsequently saw their rates decline. Australia, too, was above the average rate in 1972 but went on to have rates of business ownership well above the average. Similarly, countries like Canada or Ireland began below the average and were above the average by 2002.
In this penultimate section, therefore, a number of factors that seek to explain these changes are presented. These factors - changes in the cost structure of industry, rapid technological development, innovation, an increase in the service economy, changes in the labour market and shifts in government policy - should not be seen in isolation. Indeed, such factors are very likely to interact with each other. Furthermore, these factors tend to explain why ownership rates in the majority of OECD countries have either increased gradually over time or recovered from a dip in the 1970s to 1980s.
