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on Entrepreneurship |
| By: | Hyunso Kim; Hyo Kang; Jaeyong Song |
| Abstract: | Recent advances in generative artificial intelligence (AI) are reshaping who enters entrepreneurship, but not who reaches the top of the quality distribution. Using data on over 160, 000 product launches on Product Hunt, we find that entrepreneurial entry increased sharply following the public release of ChatGPT-3.5, driven disproportionately by solo entrepreneurs. This shift toward solo entry is particularly pronounced in categories that historically favored team-based ventures. However, much of this growth reflects low-commitment, experimental entry and does not translate into greater representation among the highest-quality outcomes. Team-based ventures are increasingly dominant in the top tiers of platform rankings. These findings suggest that generative AI lowers barriers to solo entrepreneurship while reinforcing team-based advantages. |
| Date: | 2026–05 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2605.10291 |
| By: | Henrekson, Magnus (Research Institute of Industrial Economics (IFN)) |
| Abstract: | This paper analyzes Sweden’s entrepreneurial performance from an institutional and evolutionary perspective, using the concept of the collaborative innovation bloc. It argues that economic development is driven not by entrepreneurial entry per se, but by the capacity of institutional arrangements to channel entrepreneurial effort into large-scale, productivity-enhancing activities. Sweden provides an instructive case: despite strong performance in innovation and start-up formation, the economy performs less well in turning young firms into globally competitive enterprises. The analysis emphasizes the complementarity between entrepreneurs and key actors—investors, skilled employees, and competent customers—and the role of institutional incentives in coordinating their interaction over time. While past reforms have improved conditions for entry, remaining distortions in taxation, labor market regulation, and capital allocation may bias outcomes toward early exit rather than sustained growth. |
| Keywords: | Collaborative innovation bloc; Entrepreneurial ecosystem; Entrepreneurship policy; Scale-up policy; Innovative entrepreneurship |
| JEL: | H50 I28 L26 O31 P16 R38 |
| Date: | 2026–05–16 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:iuiwop:1559 |
| By: | Fairlie, Robert (University of California, Los Angeles) |
| Abstract: | The paper provides a descriptive analysis of both the early impacts of COVID on business activity among immigrants and the economic recovery over the next few years. The findings indicate that immigrant business owners were disproportionately affected by COVID in the first month of the pandemic when mandated shutdowns through social distancing restrictions were the most severe. Immigrant business activity recovered somewhat inconsistently through the end of 2020 but started a longer-term upward trend in both absolute terms and relative terms over the next few years. By the end of 2024, the number of active immigrant business owners increased to 3.9 million compared with 3.0 million just prior to the start of the pandemic. Growth in the Construction, Transportation, Professional and Business Services, and Financial Activities industry groups fueled total growth in immigrant business activity during the recovery period. The percentage of the labor force owning an active business is 3.5 percentage points higher than U.S. born active business ownership rates, which is larger than the 1.8 percentage point gap before the pandemic started. |
| Keywords: | entrepreneurship, self-employment, business ownership, COVID, pandemic, recovery, immigrant, immigration, inequality |
| JEL: | L26 J15 |
| Date: | 2026–05 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18635 |
| By: | Werner, Sven; Trotter, Philipp |
| Abstract: | Development finance increasingly funds entrepreneurship in developing countries, but evidence of its impact on entrepreneurship is mixed. Existing studies analyze total development finance flows as entrepreneurship-specific development finance data did not previously exist. By training and validating a machine-learning classifier on development finance project descriptions (2000-2022; 5 million projects; 97% accuracy), we introduce a scalable, replicable measure of specific entrepreneurship-support development finance (ESDF). Crucially, this measure allows us to assess which entrepreneurship margins respond to development finance. In a 19-year panel of 50 developing countries, two-way fixed-effects regressions show that higher ESDF is associated with higher entrepreneurial intentions, while total development finance is not. ESDF is not significantly linked to early-stage entrepreneurial activity, however, suggesting conversion bottlenecks in current entrepreneurial processes. |
| Abstract: | Entwicklungsfinanzierung richtet sich zunehmend auf die Förderung von Entrepreneurship im Globalen Süden. Die makroökonomische Evidenz zur Wirksamkeit dieser Förderung ist bislang jedoch uneinheitlich. Bisherige Studien greifen auf aggregierte Daten zur Entwicklungsfinanzierung zurück, da spezifische Daten zur Entrepreneurship-Förderung bislang nicht verfügbar waren. In diesem Papier entwickeln wir ein skalierbares und replizierbares globales Maß für die Förderung von Entrepreneurship durch Entwicklungsfinanzierung (entrepreneurship-support development finance, ESDF). Dazu trainieren und validieren wir ein Machine-Learning-Klassifikationsmodell auf Basis der Beschreibungen von 5 Millionen Entwicklungshilfeprojekten aus den Jahren 2000 bis 2022 (Genauigkeit des Modells: 97 %). Mit diesem Maß kann die Wirkung von ESDF auf verschiedene Stufen des Gründungsprozesses untersucht werden. Auf Basis eines Panels von 50 Ländern über 19 Jahre zeigen Regressionen mit Länder- und Jahreseffekten, dass ein höheres ESDF-Volumen mit stärkeren Gründungsabsichten einhergeht, während sich für aggregierte Entwicklungsfinanzierung kein entsprechender Zusammenhang zeigt. Zugleich ergibt sich kein signifikanter Zusammenhang zwischen ESDF und der Gründungsaktivität. Dies spricht dafür, dass zusätzliche Förderung zwar die Gründungsneigung erhöht, sich aber nicht automatisch in tatsächliche Gründungen übersetzt. |
| Keywords: | Entrepreneurship-support development finance, international assistance, entrepreneurial intentions, early-stage entrepreneurship, machine learning classification |
| JEL: | F35 O19 L26 C23 C45 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:rwirep:341094 |
| By: | Daisuke TSURUTA |
| Abstract: | This paper examines the relationship between managerial aging, succession prospects, and credit allocation to small and medium-sized enterprises (SMEs) in Japan. We focus on firms managed by elderly owners without designated successors, which we interpret as exhibiting weakened going-concern prospects. Using comprehensive firm-level data, we investigate firm performance, default risk, and bank lending behavior during normal periods and economic crises, particularly the Global Financial Crisis and the COVID-19 pandemic. We find that firms with elderly managers and those lacking successors exhibit lower profitability, slower growth, and higher probabilities of default and exit, with these adverse effects becoming more pronounced during crises. Despite their weak fundamentals, such firms experience increased reliance on bank borrowing during crisis periods, suggesting potential credit misallocation. This pattern was particularly strong during the COVID-19 crisis, likely reflecting extensive public financial support. Our findings highlight how population aging can distort credit allocation in SMEs and provide new evidence on crisis-driven misallocation in an aging economy. |
| Date: | 2026–05 |
| URL: | https://d.repec.org/n?u=RePEc:eti:dpaper:26039 |
| By: | Suvam Pal; Viktor Stojkoski; Arnab Pal; Trifce Sandev |
| Abstract: | We study a generalized geometric Brownian motion framework that incorporates both entries of new units and exit mechanisms for the current population, extending earlier stochastic resetting models where these rates are treated as identical. The model captures realistic features observed in many economic observables, which can be explained as market-driven firm entries/exits, worker inflow/outflow, and income growth/loss. This model is not conservative and, despite the asymmetry in the entry and exit rates, we find that the system eventually relaxes to a stationary distribution. Moreover, our analysis reveals three distinct dynamical regimes in the moments of the distribution, arising from the interplay between volatility, drift, entry, and exit rates. We further derive the survival probability and the mean first-passage time associated with the observed variable reaching certain threshold under the competing entry-exit processes. Interestingly, we identify an optimal exit rate that minimizes the mean first-passage time, providing insights into how entry and exit policies can influence the outcome of the system. These results should be useful for understanding the long-run behavior of economic systems in which growth, volatility, entry, and exit jointly shape the evolution of heterogeneous units. |
| Date: | 2026–05 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2605.17299 |
| By: | Piet Sercu (KU Leuven); Tom Vinaimont (Nazarbayev University, Graduate School of Business) |
| Abstract: | In the standard dual-class equity structure, the founder retains control via a blocking minority, typically achieved via multiple-vote share ownership. This strengthens the founder's position in takeover fights or talks and thus stimulates entrepreneurship but, in The Economist's wording, such companies are 'shunned' by many investors. To stimulate entrepreneurship with full respect of One-Share/One-Vote and without any blocking toehold, one can, instead, stipulate that a takeover requires the votes of both equity classes. Acquisitions happen after an open fight, where the incumbent's only advantage is that they can block the attempt by counterbidding for just one class. The incumbent's option to block the takeover by buying just one class of shares, we show, generates better terms if and when the firm is taken over, which translates in a higher IPO or PE value and, thus, stronger entrepreneurial incentives. The cost of the proposed charter is, inevitably, some degree of managerial entrenchment, but by our reckoning the benefits exceed the cost. The value-boosting effect is quite powerful when the potential for value-improving takeovers is high, notably for entrepreneurs who do have bright ideas but are not good at organization, or for incumbents facing rivals with big toeholds. |
| Keywords: | Corporate Control, Security Design, Dual-class Shares, Takeovers, Efficiency |
| JEL: | G32 G34 |
| Date: | 2026–02 |
| URL: | https://d.repec.org/n?u=RePEc:asx:nugsbw:2026-02 |
| By: | Ali Ozdagli; Maddie Shaheen |
| Abstract: | Our research suggests that if the world becomes increasingly interconnected through international trade, entrepreneurship rates will decrease over time. |
| Keywords: | trade; international economics; labor; entrepreneurship |
| Date: | 2024–08–06 |
| URL: | https://d.repec.org/n?u=RePEc:fip:d00001:98650 |
| By: | Afroza Alam; André Diegmann |
| Abstract: | This paper provides new causal evidence on how patent allowances affect firms and their employees based on quasi-random assignment of patent applications to examiners. Exploiting employer–employee records with newly linked German firm data and web-scraped patent documents, we show that patent-induced shocks reduce firm exit, improve productivity, and increase wages, with rent-sharing elasticities between 0.10 and 0.21. Wage gains are broadly observed across occupational tasks, with high heterogeneity: managers benefit disproportionately in publicly traded firms, whereas broader wage increases accrue to workers in non-traded firms. Our findings highlight the role of institutional features and firm organization in shaping how rents are shared. |
| Keywords: | innovation, firm performance, worker compensation, rent sharing |
| JEL: | O31 O34 J31 D22 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_12666 |
| By: | Belgartit Sabba, Mohamed |
| Abstract: | La inmigración suele entrar en el debate económico español por la puerta del empleo asalariado. Es comprensible: ahí están los grandes volúmenes, las cotizaciones y las urgencias de muchos sectores. Pero esa lectura deja fuera una parte menos visible de la misma realidad: inmigrantes que trabajan por cuenta propia, pequeños empleadores que contratan, negocios familiares, profesionales autónomos, proyectos nacientes que todavía no han alcanzado una forma empresarial estable y actividades que sostienen comercio, hostelería, cuidados, transporte, construcción o servicios de proximidad. El análisis de los datos no permite una frase fácil. En la EPA del primer trimestre de 2026, la población extranjera representa el 15, 8 % de la ocupación y el 16, 0 % del trabajo por cuenta propia. Vista así, su presencia empresarial se parece mucho a su peso laboral. La diferencia aparece al abrir el grupo extranjero: los comunitarios alcanzan una tasa de trabajo por cuenta propia del 20, 8 %, bastante por encima de la española, mientras que los no comunitarios quedan en el 12, 3 %. Estos últimos, aun con menor intensidad relativa, reúnen más volumen absoluto dentro del autoempleo extranjero. No es una contradicción. Es la diferencia entre tasa y tamaño. La investigación combina EPA, Seguridad Social, GEM España 2024-2025, Censo anual del INE, Banco de España y literatura académica reciente. Se compara población española, doble nacionalidad, extranjeros de la Unión Europea y extranjeros no comunitarios. La primera generación se aproxima con el país de nacimiento; la segunda se aborda con cautela, porque la estadística pública todavía no cruza de forma cómoda generación migratoria, condición empresarial, sector y tamaño de negocio. Esa laguna no es menor. Precisamente por eso las conclusiones se formulan con prudencia. |
| Keywords: | inmigración, emprendimiento, trabajo autónomo, España, empresarios inmigrantes, mercado laboral |
| JEL: | J15 J61 L26 M13 O15 |
| Date: | 2026–05 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:129112 |
| By: | Koji INOUE; Yoshimi YAMADA; Hikaru FUKANUMA |
| Abstract: | This paper examines how trade relationships affect the financing of newly established enterprises, focusing on both credit supply by financial institutions and credit demand by enterprises. While prior research has primarily emphasized entrepreneurs’ human capital and firm attributes, they have paid limited attention to the role of interfirm relationships. Using firm-level data, this paper analyzes whether the characteristics of trading partners and inter-organizational ties influence borrowing and lending behavior. The results show that securing high-performing trading partners is unlikely to increase the probability of obtaining bank loans, but tends to reduce the loan amounts received among enterprises that obtain loans. Additionally, sharing the same main bank with a trading partner actually reduces the likelihood of borrowing, although this negative association is mitigated when the return on assets of the enterprise is high. Furthermore, when the CEO shares the same university affiliation as the trading partner’s CEO, the probability of borrowing decreases, whereas sharing the same prefecture of origin is associated with larger loan amounts. These findings suggest that trade relationships function not only as informational signals to financial institutions but also as alternative channels of financial adjustment, thereby shaping both credit supply and demand for newly established enterprises. |
| Date: | 2026–05 |
| URL: | https://d.repec.org/n?u=RePEc:eti:rdpsjp:26024 |