Business Activity and its Concentration in the Czech
Republic and Poland in the years 2018–2020
Eva HAMPLOVÁ1*, Beata BAL-DOMAŃSKA2 and Kateřina PROVAZNÍKOVÁ1
1 University of Hradec Králové, Hradec Králove, Czech Republic; eva.hamplova@uhk.cz;
katerina.provaznikova@uhk.cz
2 Wroclaw University of Economics and Business, Wroclaw, Poland; Beata.Bal-Domanska@ue.wroc.pl
* Corresponding author: eva.hamplova@uhk.cz
Abstract: The paper evaluates the business environment in two economies, by means of the
number of actively operating business units in the Czech Republic and Poland in 2018 and
2020. The aim of this article is to assess which regions at the level of Nomenclature of Units
for Territorial Statistics show the highest share of active entrepreneurs in terms of the
population aged 15-64 in the given region. The subsequent evaluation of business activity
over time is especially important. Data from the Czech Statistical Office and Statistics Poland,
which are publicly available and can contribute to monitoring the impact of a pandemic crisis
on entrepreneurs or the business environment, were used to analyze the concentration of
active entrepreneurship. For the regional evaluation of the concentration of business activity,
the characteristics of the organized statistical series were used, especially quartiles, and
subsequently a map was created in order to visualize the differences in the concentration of
business activity at the national and international level. In the Czech Republic, the
concentration of entrepreneurs is higher in almost all regions than in Poland, despite the fact
that the share of active entrepreneurs in the total number of registered is significantly lower
than in Poland.
Keywords: business; business environment; national economy
JEL Classification: L25; L26; O10
1. Introduction
A regionally balanced business climate is not only a very important issue, but it could
even be said to be the primary one, especially in a modern market environment, as it has a
significant impact on employment (Thurik et al., 2008), where the business sector has become
a key factor, on innovation, the state budget, or, last but not least, on the external economic
balance (Stloukalová et al., 2015). The development of the number of statistical units of the
enterprise type and their dynamics significantly declare the development of the business
sector, the state of the given national economy and, last but not least, regional differences in
business at the level of territorial units (Carree, 2015).
Small and medium-sized enterprises, which represent a substantial part of the business
sector, have become an increasingly important part of economic development. In this context,
it appears that small and medium-sized enterprises can be characterized as the main engine
of economic growth. Research has shown that new firms grow faster than established ones
doi: 10.36689/uhk/hed/2021-01-021
doi: 10.36689/uhk/hed/2021-01-020
BUSINESS ACTIVITY AND ITS CONCENTRATION IN CZECHIA AND POLAND
(Davidsson et al., 2002), thus making a significant contribution to job creation and
compensating for job losses in large firms. Therefore, from the point of view of economic
policy, it is necessary to know how business activity develops in a given country. This
information can help to better target economic policy focused on the support of
entrepreneurship (Hamplová & Kovárník, 2020).
Entrepreneurship is systematically linked to job growth and over time this relationship
has intensified (Dvouletý & Orel, 2020). Entrepreneurship has the greatest impact on the
region in which it operates, but it also has positive side-effects on job growth in neighbouring
regions (Bal-Domańska, 2018). Entrepreneurship has greater national economic effects in
more urbanized regions, where businesses benefit from a condensed market (Henderson &
Weiler, 2010). It is the assessment of the intensity of absorption of business support in the
regions that can be a significant factor in their disparities, although this is not clearly proven.
Based on the analysis, it was not possible to prove the hypothesis that in the Czech Republic
business entities operating in problem regions are preferred when it comes to deciding on
the support of projects in the form of subsidies (Felixová, 2012).
2. Methodology
The internal database of the Czech Statistical Office obtained from the Register of
Economic Entities and of the Statistics Poland was used in the processing of data used in this
article. The basic difference between the data publicly available and the data used in this
paper is in the concept of the so-called enterprises showing economic activity. According to
the Czech Statistical Office, an enterprise showing economic activity is characterized by the
fact that in the year of monitoring its activity was identified through the Financial
Administration, the Social Security Administration alternatively other administrative
sources. According to the Statistics Poland, declared entrepreneurial activity is characterized
by the number of entities of the national economy in the REGON register (excluding natural
persons running only individual farms). The presented data relate to the so-called active
entities, i.e. those that have not reported, for example, the suspension of their activities, are
not bankrupt or have not started their activity yet.
Records of the number of enterprises in the years 2018-2020 were obtained through the
Information Services Department of the Czech Statistical Office and the Department of
Coordination of Business Statistics and business cycle surveys of the Czech Statistical Office
and Statistics Poland. The data are organized according to individual regions of the Czech
Republic, of which there are 14, and according to individual voivodships of Poland, of which
there are 16, and they document the specific number of business entities with identified
activity in individual years. Data from the Czech Statistical Office (2020a) and Statistics
Poland (2020) for 2020 and 2018 were accepted for the analysis. The basic unit for evaluating
the concentration of business activity is the number of active entrepreneurs per 1,000
inhabitants aged 15-64. The number of inhabitants in individual regions was obtained from
the data of the Czech Statistical Office (2020b) always as of 1 January of the given period. The
characteristics of the ordered statistical series were used for the regional evaluation of the
concentration of business activity, especially the quartiles.
BUSINESS ACTIVITY AND ITS CONCENTRATION IN CZECHIA AND POLAND
2. Analysis of Concentration of Active Business Units in the Czech Republic and Poland
in 2020-2018
Four regions in the Czech Republic (Prague, Central Bohemia, South Moravia, MoraviaSilesia)
account for more than 50% of the total number of active businesses in the Czech
Republic. In the total number of active business units, enterprises with up to 249 employees
represent 99.84%. Representation of active business units has an overwhelming majority in
the form of small and medium-sized enterprises (Hamplová & Kovárník, 2016). According to
Statistics Poland (2020) the situation in Poland is similar. From Tab. 1 on the number of
registered business entities, it is clear that 46% of registered entrepreneurs did not report
business activity in 2020, which would be recordable through the Financial Administration,
the Social Security Administration alternatively other administrative sources. From the point
of view of the entire Czech Republic, the share of active business units is 54% as of
31 December 2020. The share of active business units within the CZ-NUTS 3 regions is shown
in Tab. 1. The Karlovy Vary region even has only 51% of active business units overall
registered. A change was recorded in all regions compared to 2018. The number of active
entrepreneurs increased in absolute terms in all regions. In the Prague region it was even by
10%. This fact it is also evident from Tab. 1, where the change is evaluated relatively, i.e. as
the ratio of the number of entrepreneurs declaring an activity to the number of entrepreneurs
registered. Increased business activity is recorded in 13 regions of the Czech Republic.
Table 1. Number of registered and actually active entrepreneurs by CZ-NUTS 3 and by territorial
division as of 31 December 2020, 2018. (Czech Statistical Office, 2020a)
Region
CZ-NUTS 3
Registered
(1)
Declared
activity (2)
Ratio 2020
(2) / (1)
Ratio 2018
Number of
registered
entrepreneurs
per 1,000
inhabitants in
age (15 – 64)
Number of
active
entrepreneurs
per 1,000
inhabitants in
age (15 – 64)
Czech Republic 2,932,963 1,576,331 54%  52% 428 230
Prague 644,586 380,723 59%  56% 748 442
Central Bohemian 351,185 194,803 55%  54% 398 221
South Bohemian 166,853 87,012 52%  51% 407 212
Plzeň 147,671 73,071 49% 49% 390 193
Karlovy Vary 73,997 33,290 45%  44% 390 175
Ústí nad Labem 176,004 83,717 48%  46% 333 159
Liberec 118,076 57,144 48%  47% 420 203
Hradec Králové 141,343 74,445 53%  52% 408 215
Pardubice 122,901 65,585 53%  52% 368 197
Vysočina 116,360 64,919 56%  55% 357 199
South Moravian 326,100 175,952 54%  53% 428 231
Olomouc 145,374 74,273 51%  50% 361 185
Zlín 144,213 76,050 53%  52% 387 204
Moravian-Silesian 258,300 135,347 52%  51% 333 174
The number of active entrepreneurs per 1,000 inhabitants aged 15-64 is a category with
which we will continue to work when evaluating the concentration of active business units.
From the point of view of regions according to the territorial division of CZ-NUTS 3, the
highest concentration can be recorded in the Prague region (442 entrepreneurs per 1,000
BUSINESS ACTIVITY AND ITS CONCENTRATION IN CZECHIA AND POLAND
inhabitants aged 14-64), followed by the South Moravian region (231), the Central Bohemian
region (221), Hradec Králové region (215), the South Bohemian region (212), Zlín region (203),
Liberec region (203). The other half of the group consists of the Vysočina region (199), the
Pardubice region (197), the Plzeňský region (193), the Olomouc region (185), the Karlovy
Vary region (175), the Moravian-Silesian region (174) and Ústí nad Labem region (158). From
the perspective of the CZ-NUTS 3 regions, this region appears to be the region with the lowest
number of active business units per 1,000 inhabitants of this region (Fig. 1).
From Tab. 2 on the number of registered business entities, it is clear that 12% of registered
entrepreneurs did not report business activity in 2020. From the point of view of the entire
Poland, the share of active business units is 88% as of 31 December 2020. The share of active
business units within the PL-NUTS 2 regions is shown in Tab. 2.
A change was recorded in all regions compared to 2018. Although the number of active
entrepreneurs in all regions increased in absolute terms, a relative decrease was recorded in
all voivodships. This fact is also evident from Tab. 2, where the relative change is evaluated,
i.e. as the ratio of the number of entrepreneurs declaring activity to the number of registered
entrepreneurs.
Table 2. Number of registered and actually active entrepreneurs by PL-NUTS 2 and by territorial
division as of 31 December 2020, 2018. (Statistics Poland, 2020)
Region
PL-NUTS 2
Registered
(1)
Declared
activity (2)
Ratio 2020
(2) / (1)
Ratio
2018
Number of
registered
entrepreneurs
per 1,000
inhabitants in
age (15-64)
Number of
active
entrepreneurs
per 1,000
inhabitants in
age (15-64)
Poland 4,663,378 4,103,598 88%  90% 184 161
Dolnośląskie 396,046 348,356 88%  90% 207 182
Kujawsko-pomorskie 209,750 186,604 89%  91% 152 135
Lubelskie 192,737 168,061 87%  90% 138 120
Lubuskie 120,839 106,038 88%  90% 179 157
Łódzkie 261,498 229,999 88%  90% 164 144
Małopolskie 426,306 375,185 88%  90% 188 165
Mazowieckie 887,329 786,938 89%  91% 251 223
Opolskie 105,694 95,009 90%  92% 160 144
Podkarpackie 188,360 165,993 88%  90% 131 115
Podlaskie 109,492 96,962 89%  91% 138 122
Pomorskie 318,518 272,628 86%  88% 206 176
Śląskie 494,282 434,964 88%  90% 166 146
Świętokrzyskie 120,062 105,884 88%  90% 147 130
Warmińsko-mazurskie 136,403 119,390 88%  90% 142 124
Wielkopolskie 461,225 411,684 89%  91% 199 177
Zachodnio-pomorskie 234,131 199,348 85%  88% 207 177
A change was recorded in all regions compared to 2018. Although the number of active
entrepreneurs in all regions increased in absolute terms, a relative decrease was recorded in
all voivodships. This fact is also evident from Tab. 2, where the relative change is evaluated,
i.e. as the ratio of the number of entrepreneurs declaring activity to the number of registered
entrepreneurs.
BUSINESS ACTIVITY AND ITS CONCENTRATION IN CZECHIA AND POLAND
From the point of view of regions according to the territorial division of PL-NUTS 2, the
highest concentration can be recorded in Mazowieckie region (223 entrepreneurs per 1,000
inhabitants aged 15–64), followed by Dolnośląskieregion (182), Wielkopolskie region
(177.23), Zachodnio-pomorskieregion (176.58), Pomorskie (176), Małopolskie region (165),
Lubuskie region (157), Śląskie region (146). The other half of the group consists of
Łódzkieregion (144), Opolskie region (144), Kujawsko-pomorskie region (135),
Świętokrzyskie region (130), Warmińsko-mazurskieregion (124), Podlaskieregion (122),
Lubelskie region (120) and Podkarpackie (115). From the perspective of the CZ-NUTS 2
regions, this region appears to be the region with the lowest number of active business units
per 1,000 inhabitants of this region (Fig 2).
3. Results and Discussion
From the information stated above it is evident that the two compared countries under
with a very similar 50-year economic history share some clear similarities and, conversely,
significant differences can be identified. Both evaluated countries have a very similar
organizational structure of their national economy. The vast majority of business entities are
included in the category of micro-company (Table 3).
Table 3. Number of actually active entrepreneurs according to the size as of 31 December 2020
Country
Declared
activity
TOTAL
Size 0 – 9
Number of
employees
Size 10 - 49
Number of
employees
Size 50 - 249
Number of
employees
Size 250 =>
Number of
employees
Poland 4,103,598
100%
3,945,983
96.2%
127,394
3.1%
26,113
0.6%
4,108
0.1%
Czech Republic 1,576,331
100%
1,519,429
96.4%
43,215
2.7%
11,367
0.7%
2,320
0.1%
More than 2/3 of business units have the form of a natural person without legal
subjectivity and 1/3 of entrepreneurs have the form of legal persons (Table 4).
Table 4. Number of actually active entrepreneurs according to the legal forms as of 31 December 2020
Country
Declared activity
TOTAL
Legal persons
Natural persons
running a business
Poland 4,103,598
100%
1,272,464
31%
2,831,134
69%
Czech Republic 1,576,331
100%
458,475
29%
1,117,856
71%
Both countries are assessed almost identically according to the Doing Business study
(World Bank, 2020). The study has compared business rules and regulations that characterize
the business environment for 17 years.
However, the analysis shows a completely different intensity of specific entrepreneurs´
involvement in the active business of a particular country. While in the Czech Republic an
entrepreneur registers either as a natural person or a legal entity for the purpose of
entrepreneurial activity, subsequently this activity is actually actively performed by every
other entrepreneur. We can explain this fact mainly due to the very high involvement of
BUSINESS ACTIVITY AND ITS CONCENTRATION IN CZECHIA AND POLAND
natural persons in business. These people have the business as a secondary form of income.
In other words, they have a job and are employees and earn extra money from the business.
The situation is completely different in the case of Poland. Although natural persons running
only individual farms are not included in the number of business entities, approximately
every 10 registered entrepreneurs will not participate in active business.
Figure 1. Number of entrepreneurs in regions of the Czech Republic per 1,000 inhabitants aged 15-64
as of 31 December 2020
Figure 2. Number of entrepreneurs in voivodships of Poland per 1,000 inhabitants aged 15 – 64 as of
31 December 2020
4. Conclusions
This paper focused on the evaluation of the current situation of business activity in the
Czech Republic and Poland. The aim was to map the extent of the involvement of
entrepreneurs in individual countries and also in individual regions (voivodships), to
visualize the differences at the national and international level. In the Czech Republic, the
LEGEND
1. Q 441.54 – 215.02
2. Q 214.28 – 203.04
3. Q 201.01 – 193.05
4. Q 186.74 – 158.60
LEGEND
1. Q 222.59 – 176.58
2. Q 176.23 – 146.37
3. Q 145.23 – 129.99
4. Q 128.50 – 115.42
BUSINESS ACTIVITY AND ITS CONCENTRATION IN CZECHIA AND POLAND
share of active entrepreneurs is very low due to the number of registered entrepreneurs
(54%), but compared to 2018, this involvement is 2% higher. In 2020, absolutely and relatively
more entrepreneurs joined the business than in 2018. It follows from the above that the
COVID 19 crisis has paradoxically increased business activity in the Czech Republic.
Unfortunately, it cannot be ruled out that the motive for the increased activity was the
widespread use of state aid in connection with government regulations restricting business
activity during the COVID 19 pandemic. In Poland, the situation developed differently. The
absolute number of registered entrepreneurs increased, but the relative number decreased by
2%. Relatively fewer entities declared business activity at the time of the 2020 crisis than in
2018. It was here that a problem related to the limitation of business activity may have arisen
in 2020, which we cannot confirm due to the low detail of the analyzed data. When comparing
entrepreneurial activity, which was evaluated in this paper on the basis of the number of
activities of declaring entrepreneurs per 1,000 people aged 15-64, the concentration of these
entrepreneurs is significantly higher in the Czech Republic and in almost all its regions than
in Poland.
Acknowledgments: This research was funded by Specific research grant 2021 Economic Impacts under the
Industry 4.0/Society 5.0 Concept at the Faculty of Informatics and Management of the University of Hradec
Kralove, Czech Republic. It was prepared in cooperation with students of Ph.D. study at Department of
Economics, namely with Ing. Lucie Novotná and Ing. Martin Král.
References
Bal-Domańska, B. (2018). The Socio-economic Dimension of Industry in Subregions. Argumenta Oeconomica
Cracoviensia, 19, 133–152. https://doi.org/10.15678/AOC.2018.1907
Carree, M., Congregado, E., Golpe, A., & van Stel, A. (2015). Self-employment and job generation in
metropolitan areas, 1969–2009. Entrepreneurship & Regional Development, 27(3–4), 181–201.
https://doi.org/10.1080/08985626.2015.1025860
Czech Statistical Office. (2020a). Births and deaths of businesses [Data set]. Database of the Statistical Business
Register. Not public, internal document.
Czech Statistical Office. (2020b). Population of territorial units of the Czech Republic, 1 January 2020. [Data set]. Retrieved
December 12, 2020 from. https://www.czso.cz/csu/czso/population-of-municipalities-1-january-2020
Davidsson, P., Kirchhoff, B., Hatemi-J, A., & Gustavsson, H. (2002). Empirical Analysis of Business Growth
Factors Using Swedish Data. Journal of Small Business Management, 40(4), 332–349.
https://doi.org/10.1111/1540-627X.00061
Dvouletý, O., & Orel, M. (2020). Individual determinants of entrepreneurship in Visegrád countries: Reflection
on GEM data from the Czech Republic, Hungary, Poland, and Slovakia. Entrepreneurial Business and
Economics Review, 8(4), 123–137. https://doi.org/10.15678/EBER.2020.080407
Felixova, K. (2012). Evaluation of the absorption intensity of the entrepreneurial support in the regions funded
intensely by the government. E+M: Ekonomie a Management, 15(1), 17–27.
Hamplová, E., & Kovárník, J. (2020). Globalization and Entrepreneurship: Selected Topics in Visegrad Four
Countries. SHS Web of Conferences, 74, 05009. https://doi.org/10.1051/shsconf/20207405009
Hamplová, E., & Kovárník, J. (2016). Analýza vývoje počtu podnikatelských jednotek v České republice v letech
2008—2014. In 19th International Colloquium on Regional Sciences. Conference Proceedings (pp. 226–232).
https://doi.org/10.5817/CZ.MUNI.P210-8273-2016-28
Henderson, J., & Weiler, S. (2010). Entrepreneurs and Job Growth: Probing the Boundaries of Time and Space.
Economic Development Quarterly, 24(1), 23–32. https://doi.org/10.1177/0891242409350917
Statistics Poland. (2020). Kwartalna informacja o podmiotach gospodarki narodowej w rejestrze REGON rok 2020 [Data
set]. Retrieved January 31, 2020, from https://stat.gov.pl/obszary-tematyczne/podmioty-gospodarcze-
wyniki-finansowe/zmiany-strukturalne-grup-podmiotow/kwartalna-informacja-o-podmiotach-
gospodarki-narodowej-w-rejestrze-regon-rok-2020,7,8.html
BUSINESS ACTIVITY AND ITS CONCENTRATION IN CZECHIA AND POLAND
Stloukalová, T., Jurčík, R., & Srdošová, K. (2015). Malé a střední podniky ve veřejných zakázkách krajů v České
republice. In 18th International Colloquium on Regional Sciences. Conference Proceedings (pp. 143–147).
https://doi.org/10.5817/CZ.MUNI.P210-7861-2015-18
Thurik, A. R., Carree, M. A., van Stel, A., & Audretsch, D. B. (2008). Does self-employment reduce
unemployment? Journal of Business Venturing, 23(6), 673–686. https://doi.org/10.1016/j.jbusvent.2008.01.007
World Bank. (2020). Doing business 2020: Comparing business regulation in 190 economies. The World Bank.