This multicountry study empirically explores the institutional determinants of macro‐level entrepreneurship. Findings suggest that a society's normative, cultural‐cognitive, and regulative institutions are related to entrepreneurial activity. Normative and cultural‐cognitive institutions’ descriptive power in explaining entrepreneurial activity is higher than regulative institutions' or per capita gross domestic product. This suggests that differences in values, beliefs, and abilities may play a greater role than purely economic considerations of opportunity and transaction costs. Specific attention is given to opportunity‐ and necessity‐motivated entrepreneurship due to their relationship to economic development.