Entrepreneurship and income inequality: a spatial panel data analysis

Does income inequality sand or grease the wheels of entrepreneurial activity? International evidence

“…Overall, we see that not only has the literature largely neglected to consider the role of income inequality in entrepreneurship, the sensitivity of results to the prevalence of entrepreneurship is another important aspect that has been largely ignored. Our quantile regression findings provide an interesting complementary insight to Ragoubi and El Harbi (2018). Whereas using spatial analysis the authors find an inverted U‐shaped relation between entrepreneurship and income inequality (using a smaller set of nations and a somewhat different time frame), our results across the prevalence of entrepreneurship find a U‐shaped relation—that is, the negative effect of income inequality at a lower prevalence of entrepreneurship and positive effects at higher prevalence.…”

“…Researchers have considered numerous influences on entrepreneurship, with varying significance (Acs & Audretsch, 2005; Cebula et al, 2015). The effect of income inequality has garnered more recent attention in the income inequality‐entrepreneurship nexus (see Halvarsson et al, 2018; Kimhi, 2010; Ragoubi & El Harbi, 2018).…”

“…Using a sample of 72 developed and developing nations, an interesting recent study by Ragoubi and El Harbi (2018) considers spatial spillovers from income inequality to entrepreneurship. The authors find the presence of both positive and negative spatial spillovers.…”

“…The importance of entrepreneurship in fueling economic growth has dawned on policymakers worldwide, yet identification of factors that are key drivers of entrepreneurship is far from complete. Researchers have considered numerous influences on entrepreneurship (Acs & Audretsch, 2005; Cebula, Hall, Mixon, & Payne, 2015; Goel & Saunoris, 2018, 2020), and some studies have considered the impact of income inequality on entrepreneurship (Atems & Shand, 2018; Halvarsson, Korpi, & Wennberg, 2018; Ragoubi & El Harbi, 2018). Income inequalities have been persistent in many nations of the world, despite government redistribution efforts.…”

Effect of Economic Vulnerability on Competitive Advantages, Enterprise Performance and Sustainability

“…It has been reckoned that small business ownership and self-employment are on the rise since past few decades in most economies (Halvarsson et al 2018;Vial and Hanoteau 2015) with governments promoting business startups so as to achieve profitable economic growth (Ragoubi and El Harbi 2017). Although the reasons for new business creation are varied, inequality and poverty continue to remain as one of the main reasons why low-income households get involved in entrepreneurship, hoping for some increased income and wealth.…”