Purpose The purpose of this paper is to study the linkage of innovation and entrepreneurship to economic growth in countries with different levels of development. Design/methodology/approach Following quantitative analysis, the authors carry out three empirical approaches to examine the effects of innovation and entrepreneurship on competitiveness. In accordance with their initial study framework, they test the conceptual model of competitiveness through applying descriptive statistics, structural equation modelling (SEM) and hierarchical cluster analysis. Descriptive statistics and SEM data sources from the Global Competitiveness Report of the World Economic Forum were analysed for 148 countries. The hierarchical cluster analysis furthermore analysed Global Entrepreneurship Monitor data on 67 different countries. Findings The study confirmed that innovation and sophistication factors are crucial to the competitiveness of economies. The study also revealed the definition of five clusters relative to the competitive performance of advanced economies following the introduction of new entrepreneurship variables. Originality/value This research aims to open up avenues for the development of regional competitiveness studies.