Size matters: Entrepreneurial entry and government

Arbeitspapier

We explore the country-specific institutional characteristics likely to influence an individual's decision to become an entrepreneur. We focus on the size of the government, on freedom from corruption, and on 'market freedom' defined as a cluster of variables related to protection of property rights and regulation. We test these relationships by combining country-level institutional indicators for 47 countries with working age population survey data taken from the Global Entrepreneurship Monitor. Our results indicate that entrepreneurial entry is inversely related to the size of the government, and more weakly to the extent of corruption. A cluster of institutional indicators representing 'market freedom' is only significant in some specifications. Freedom from corruption is significantly related to entrepreneurial entry, especially when the richest countries are removed from the sample but unlike the size of government, the results on corruption are not confirmed by country-level fixed effects models.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IZA Discussion Papers ; No. 5052

Classification and Topics

• Classification: Wirtschaft ; Entrepreneurship ; Capitalist Systems: Property Rights ; Comparative Analysis of Economic Systems ; Socialist Systems and Transitional Economies: Legal Institutions; Illegal Behavior
• Subject: Entrepreneurship ; government ; market freedom ; corruption ; Unternehmer ; Unternehmensgründung ; Markteintritt ; Institutionelle Infrastruktur ; Staatsquote ; Korruption ; Wirtschaftsliberalismus ; Schätzung ; Welt

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Aidis, Ruta ; Estrin, Saul ; Mickiewicz, Tomasz
• Event: Veröffentlichung
• (who): Institute for the Study of Labor (IZA)
• (where): Bonn
• (when): 2010

Further information

• Handle: http://hdl.handle.net/10419/44187
• Last update: 10.03.2025, 11:44 AM CET