|
on Entrepreneurship |
| By: | Douhan, Robin (Research Institute of Industrial Economics (IFN)); Henrekson, Magnus (Research Institute of Industrial Economics (IFN)) |
| Abstract: | We outline a politico-economic growth system centered around the entrepreneur. By defining entrepreneurs in relation to economic rents we are able to develop a more general theory comprising central aspects of research within the fields of entrepreneurship/small business, public choice and new institutional economics. The entrepreneurial function is shown to depend crucially on the existing institutional framework. We also point to the necessity of viewing institutions as endogenously influenced by entrepreneurs. A typology of entrepreneurship is developed to further our understanding of the bilateral effects between institutional context and entrepreneurial activity. We use developments in modern history as a real-world context to substantiate our framework. Particular attention is devoted to the effects of enforcement of property rights and taxation, two of the most prominent institutions in the literature. |
| Keywords: | Entrepreneurship; Industrial Policy; Innovation; Property Rights; Regulation; Self-employment; Tax Policy |
| JEL: | H32 L25 L50 M13 O31 P14 |
| Date: | 2007–09–05 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:0716&r=ent |
| By: | Hvide, Hans K; Møen, Jarle |
| Abstract: | If entrepreneurs are liquidity constrained and cannot borrow to operate on an efficient scale, those with more personal wealth should do better than those with less wealth. We investigate this hypothesis using a unique datset from Norway. Consistent with liquidity constraints being present, we find a strong positive relationship between founder prior wealth and start-up size. The relationship between prior wealth and start-up performance, as measured by profitability on assets, increases for the main bulk of the wealth distribution and decreases sharply at the top. We estimate that profitability on assets increases by about 8 percentage points from the 10th to the 75th percentile of the wealth distribution. This suggests an entrepreneurial production function with a region of increasing returns. Liquidity constraints may then stop entrepreneurs from being able to exploit a "hump" in marginal productivity. From the 75th to the 99th percentile returns drops by about 10 percentage points. This suggests that an abundance of liquidity may to do more harm than good. |
| Keywords: | Entrepreneurship; Household Finance; Private benefits; Start-ups; Wealth |
| JEL: | E44 G14 L26 M13 |
| Date: | 2007–09 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:6495&r=ent |
| By: | Justin van der Sluis (Amsterdam Center for Entrepreneurship and University of Amsterdam); Mirjam van Praag (Amsterdam Center for Entrepreneurship, Tinbergen Institute, University of Amsterdam and IZA); Arjen van Witteloostuijn (University of Groningen and University of Durham) |
| Abstract: | We compare the returns to education (RTE) for entrepreneurs and employees, based on 19 waves of the NLSY database. By using instrumental variable techniques (IV) and taking account of selectivity, we find that the RTE are significantly higher for entrepreneurs than for employees (18.3 percent and 9.9 percent, respectively). We perform various analyses in an attempt to explain the difference. We find (indirect) support for the argument that the higher RTE for entrepreneurs is due to fewer (organizational) constraints faced by entrepreneurs when optimizing the profitable employment of their education. |
| Keywords: | entrepreneurship, self-employment, returns to education employment |
| JEL: | J23 J24 J31 J44 M13 |
| Date: | 2007–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3058&r=ent |
| By: | Matthieu Chemin |
| Abstract: | A key element of government is to uphold law and order. This paper will evaluate the impact of slow judiciaries on entrepreneurship. In 2002 a judicial reform was implemented in 6 of Pakistan's 117 districts to facilitate rapid case disposal. Drawing on a panel dataset of 875 district judges' performance between 2001 and 2003, a difference-in-differences analysis shows that judges disposed of 25 percent more cases thanks to the reform. Three rounds of the Labour Force Surveys will be then used to show that the reform improved security of property rights, encouraged people to seek loans, fostered entrepreneurship and was associated with increased transition from unemployment and paid employment to entrepreneurship. |
| Keywords: | Legal System, Entrepreneurship |
| JEL: | H11 H41 K42 O12 L26 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:lvl:lacicr:0727&r=ent |
| By: | Saul Estrin; Ruta Aidis; Tomasz Mickiewicz |
| Abstract: | In this paper we use a comparative perspective to explore the ways in which institutions and networks have influenced entrepreneurial development in Russia. We utilize Global Entrepreneurship Monitor (GEM) data collected in 2001 and 2002 to investigate the effects of the weak institutional environment in Russia on entrepreneurship, comparing it first with all available GEM country samples and second, in more detail, with Brazil and Poland. Our results provide strong evidence that Russia’s institutional environment is important to explain its relatively low levels of entrepreneurship development, where the latter is measured in terms of both number of start-ups and of existing business owners. In addition, Russia’s business environment contributes to the relative advantage of entrepreneurial insiders (those already in business) to entrepreneurial outsiders (newcomers) in terms of new business startups. |
| Keywords: | Entrepreneurship, Institutions, Networks, Russia, Poland, Brazil |
| JEL: | P36 O17 M13 |
| Date: | 2007–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2007-867&r=ent |
| By: | Nuria Rodriguez-Planas (Universitat Autònoma de Barcelona, FEDEA and IZA) |
| Abstract: | Recent empirical evidence has found that employment services and small-business assistance programmes are often successful at getting the unemployed back to work. One important concern of policy makers is to decide which of these two programmes is more effective and for whom. Using unusually rich (for transition economies) survey data and matching methods, I evaluate the relative effectiveness of these two programmes in Romania. While I find that employment services (ES) are, on average, more successful than a small-business assistance programme (SBA), estimation of heterogeneity effects reveals that, compared to non-participation, ES are effective for workers with little access to informal search channels, and SBA works for less-qualified workers and those living in rural areas. When comparing ES to SBA, I find that ES tend to be more efficient than SBA for workers without a high-school degree, and that the opposite holds for the more educated workers. |
| Keywords: | active labour market programmes, evaluation, propensity score matching, transition economies, treatment effects |
| JEL: | J21 J23 J31 J64 J65 J68 |
| Date: | 2007–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3051&r=ent |
| By: | Bianca Brandenburg; Jutta Günther; Lutz Schneider |
| Abstract: | Degree-level science and engineering skills as well as management and leadership skills are often referred to as a source of innovative activities within companies. Broken down by sectoral innovation patterns, this article examines the role of formal education and actual occupation for product innovation performance in manufacturing firms within a probit model. It uses unique micro data for Germany (LIAB) that contain detailed information about innovative activities and the qualification of employees. We find significant differences of the human capital endowment between sectors differentiated according to the Pavitt classification. Sectors with a high share of highly skilled employees engage in product innovation above average (specialized suppliers and science based industries). According to our hitherto estimation results, within these sectors the share of highly skilled employees does not, however, substantially increase the probability to be an innovative firm. |
| Keywords: | innovation, human capital, qualification, sectoral innovation system |
| JEL: | O31 J |
| Date: | 2007–09 |
| URL: | http://d.repec.org/n?u=RePEc:iwh:dispap:10-07&r=ent |