nep-ent New Economics Papers
on Entrepreneurship
Issue of 2017‒02‒12
five papers chosen by
Marcus Dejardin
Université de Namur

  1. Human Capital Acquisition and Occupational Choice: Implications for Economic Development By Mestieri, Martí; Schauer, Johanna; Townsend, Robert M
  2. Entrepreneurship, Economic Development and Institutional Environment: Evidence from OECD countries By Rafik Abdesselam; Jean Bonnet; Patricia Renou-Maissant; Mathilde Aubry
  3. A Study of the Self-Employment Assistance Program: Helping Unemployed Workers Pursue Self-Employment By Elizabeth Weigensberg; Karen Needels; Alix Gould-Werth; Ankita Patnaik; Joanne Lee
  4. Mobile phones, Institutional Quality and Entrepreneurship in Sub-Saharan Africa By Asongu, Simplice; Nwachukwu, Jacinta
  5. Measuring firm size distribution with semi-nonparametric densities By Lina Cortés; Andrés Mora-Valencia; Javier Perote

  1. By: Mestieri, Martí; Schauer, Johanna; Townsend, Robert M
    Abstract: Using household-level data from Mexico we document patterns among schooling, entrepreneurial decisions and household characteristics such as assets, talent of household members and age of the household head. Motivated by our findings, we develop a heterogeneous-agent, incomplete- markets, overlapping-generations dynasty model. Households jointly decide over their life cycle on (i) kids' human capital investments (schooling) and (ii) parents' entry, exit and investment into alternative entrepreneurial modes (subsistence and modern). With financial constraints all of these are co-determined. A calibrated version of our model can account for the broad correlation patterns uncovered in the data within and across generations, e.g., a non-monotonic relationship between educational choices and assets across occupations, growth in profits and employment for modern firms only, and dynastic persistence across generations in education and wealth. Endogenous human capital acquisition is a key driver of inequality and intergenerational persistence. Eliminating this channel would decrease the top 10% income share by 47%. Eliminating within-period borrowing constraints would increase average household expenditure by 7.1% and benefit the middle class, reducing top and bottom expenditure shares. It would also reduce by 28% the correlation between household assets and kids' schooling levels.
    Keywords: entrepreneurship; Human Capital; inequality; Mexico; Occupational choice
    JEL: I24 I25 O15 O54
    Date: 2017–02
  2. By: Rafik Abdesselam (University of Lyon, Lumière Lyon 2, COACTIS, EA 4161, France); Jean Bonnet (University of Caen Normandy, CREM-CAEN, UMR CNRS 6211, France); Patricia Renou-Maissant (University of Caen Normandy, CREM-CAEN, UMR CNRS 6211, France); Mathilde Aubry (Management School of Normandy, METIS Research Department, France)
    Abstract: The purpose of this article is to establish a typology of entrepreneurship for OECD countries over the 1999-2012 period. Our aim is to make a distinction between managerial and entrepreneurial economies, to identify groups of countries with similar economic and entrepreneurial activity variables and to determine the economic and institutional drivers of entrepreneurial activities in each group. We show that the level of development, sectoral specialization, and institutional variables related to entrepreneurship, functioning of the labor market and openness of the country are decisive to understand differences in entrepreneurship activity across countries. Results show that the pre-crisis period, from 1999 to 2008, is a period of growth favorable to entrepreneurship. The financial crisis involved a break in entrepreneurial dynamism with agricultural economies withstanding the financial crisis better. The 2010-2012 period of recovery is a period of a sharp slowdown in entrepreneurial activity, during which the countries that are less dependent on the financial sector proved to be the most resilient in terms of entrepreneurial activity. Nevertheless, it is the advanced economies of knowledge with developed financial markets, fewer institutional regulatory constraints and qualitative entrepreneurship that show the weaker unemployment rates. These findings have important implications for the implementation of public policy in order to promote entrepreneurial activity and reduce unemployment.
    Keywords: Entrepreneurship, Data analysis methods, Entrepreneurial/Managerial economies
    JEL: L26 C38 O1
    Date: 2017–02
  3. By: Elizabeth Weigensberg; Karen Needels; Alix Gould-Werth; Ankita Patnaik; Joanne Lee
    Abstract: This report for the Department of Labor examines Self-Employment Assistance (SEA) programs, which help eligible unemployment benefit recipients start businesses. It examines states’ motivation for and experience with establishing SEA programs and outcomes of SEA participants and their businesses.
    Keywords: self-employment, unemployment, unemployment insurance, entrepreneurs, SEA
    JEL: J
  4. By: Asongu, Simplice; Nwachukwu, Jacinta
    Abstract: This study investigates the role of mobile phones in governance for doing business in Sub-Saharan Africa with data from the period 2000-2012 by employing the Generalised Method of Moments. Three broad concepts of governance are explored, namely: (i) political (comprising voice & accountability and political stability/no violence), (ii) economic (involving government effectiveness and regulation quality) and (iii) institutional (including corruption-control and rule of law). Ten dimensions of entrepreneurship are considered. Two main findings are established with respect to the net effects of the interaction between mobile phones and governance dynamics. They are (1) reduced cost of business start-up procedure, the time to build a warehouse and the time to resolve an insolvency; (2) increased start-up procedure to register a business; the time to enforce a contract; the time to register a property and time to prepare and pay taxes. Implications for theory and policy are discussed.
    Keywords: Entrepreneurship; Knowledge Economy; Development; Africa
    JEL: L59 L98 O10 O30 O55
    Date: 2016–11
  5. By: Lina Cortés; Andrés Mora-Valencia; Javier Perote
    Abstract: In this article, we propose a new methodology based on a (log) semi-nonparametric (log- SNP) distribution that nests the lognormal and enables better fits in the upper tail of the distribution through the introduction of new parameters. We test the performance of the lognormal and log-SNP distributions capturing firm size, measured through a sample of US firms in 2004-2015. Taking different levels of aggregation by type of economic activity, our study shows that the log-SNP provides a better fit of the firm size distribution. We also formally introduce the multivariate log-SNP distribution, which encompasses the multivariate lognormal, to analyze the estimation of the joint distribution of the value of the firm’s assets and sales. The results suggest that sales are a better firm size measure, as indicated by other studies in the literature.
    Keywords: Firms size distribution; Heavy tail distributions; Semi-nonparametric modeling; Bivariate distributions.
    JEL: C14 C53 L11
    Date: 2017–01–16

This nep-ent issue is ©2017 by Marcus Dejardin. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.