Regulations, institutional quality and entrepreneurship

Chambers, Dustin; Munemo, Jonathan

doi:10.1007/s11149-019-09377-w

Cited by 66 publications

(42 citation statements)

References 29 publications

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“…Regulations and legal formalities can become a problem in the current socio-economic environment, as they can hinder innovation or create obstacles that limit trade and investment, and, in short, hamper economic efficiency, leading to lower levels of economic growth (Autio and Fu, 2015;Bosma et al, 2018;Chowdhury et al, 2019). This is of vital long-term importance because these costs reduce financial reserves and scale companies down, increasing their vulnerability in the face of economic difficulties, limiting opportunities for growth and the generation of employment copious ( Jacob and Michaely, 2017;Chambers and Munemo, 2019):…”

Section: Role Of Innovation and Institutionsmentioning

confidence: 99%

The role of innovation and institutions in entrepreneurship and economic growth in two groups of countries

Martín

Méndez‐Picazo

Castaño-Martínez

2019

IJEBR

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Purpose Economic growth is one the most relevant economic objectives for policy makers. In order to determine the variables that enhance such an objective it is important to consider different types of entrepreneurial activity. It is also necessary to consider the level of development and growth of a country to design the proper economic policy measures, given that entrepreneurship motivations and circumstances vary from country to country. Therefore, the purpose of this paper is to analyse the relationship between entrepreneurship and economic growth, including the role played by institutions and innovation considering two types of entrepreneurship (necessity and opportunity) and countries. Design/methodology/approach Data analysis of 31 countries with varying levels of growth and development yielded two large groups – either innovation-driven economies or efficiency-driven economies – following GEM classification based on the phases set out by the World Economic Forum. In order to test the hypotheses, a partial least squares analysis is carried out to show the existing relationships between the different variables, specifically: innovation, institutions, entrepreneurship and economic growth. Findings The empirical analysis used demonstrates that innovation positively affects economic growth and entrepreneurship. In addition, adequate functioning of institutions is shown to enhance economic growth and opportunity entrepreneurship. Finally, there is a positive relationship between entrepreneurship and economic growth. Originality/value Unlike other studies, different types of entrepreneurship (by necessity and opportunity) are essential to this analysis of the relationship between entrepreneurship and economic growth. The country sample was divided considering some country-specific structural circumstances. Neither aspect is considered in the literature and should be considered relevant for designing measures to enhance economic activity.

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Section: Role Of Innovation and Institutionsmentioning

confidence: 99%

The role of innovation and institutions in entrepreneurship and economic growth in two groups of countries

Martín

Méndez‐Picazo

Castaño-Martínez

2019

IJEBR

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“…On the other hand, poor institutional quality can increase uncertainty regarding future revenues by acting as a tax that increases the costs of business (e.g., Brunetti and Weder, 1998). Therefore, good regulatory policy quality would reduce the uncertainty surrounding potential future revenues from businesses activities, and promote entrepreneurship in both the short and the long term (e.g., Baumol and Strom, 2007;Chambers and Munemo, 2019;Sendra-Pons et al, 2022). Against this background, we can expect higher AfT flows (as well as NonAfT flows) to encourage investment-oriented remittances inflows through their positive effect on regulatory policy quality.…”

Section: Other Possible Effects Of Development Aid Including Aft and ...mentioning

confidence: 99%

“…To perform the empirical analysis concerning the effect of AfT flows on investment-oriented remittances inflows, we draw from existing works on the determinants of domestic private investment (e.g., Chambers and Munemo, 2019;Farla et al, 2016;Herzer and Grimm, 2012;Jongwanich and Kohpaiboon, 2008;Munemo, 2022;Nowak-Lehmann and Gross, 2021;Sendra-Pons et al, 2022). Specifically, we use a baseline model in which the dependent variable is the share of investment-oriented remittances inflows in GDP and where the AfT variable (i.e., total AfT or each of its component) is the main variable of interest.…”

Section: Model Specificationmentioning

confidence: 99%

Effect of AfT flows on Investment-Oriented Remittances flows

GNANGNON

2022

Preprint

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Despite the voluminous literature on the effect of Aid for Trade (AfT) flows on recipient countries' trade performance, little is known about the relationship between AfT flows and other capital flows to developing countries. This paper contributes to the literature by exploring the effect of AfT inflows on investment-oriented remittances inflows, notably through the channel of trade costs. Using an unbalanced panel dataset of 106 countries over the period 2002–2019, and the two-step system generalized method of moments, the empirical analysis has established several outcomes. AfT flows exert a positive effect on investment-oriented remittances flows, with the magnitude of this positive effect being higher in Least developed countries than in other countries, and in remittance-dependent countries. AfT flows stimulate investment-oriented remittances flows in countries that face higher trade costs. Finally, total AfT flows reduce investment-oriented remittances flows in countries that experience a higher volatility of the overall trade costs, but boost investment-oriented remittances in countries that improve the quality of trade measures. The analysis shows that AfT flows could be an important leverage for stimulating investment-oriented remittances flows, and promote the development of the private sector in beneficiary countries.

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“…Besides studying how the incidence of disease epidemics influence entrepreneurial activity, we also consider the severity of epidemics related to transmission (the number of people affected by epidemics) and mortality (the number of deaths caused by epidemics) and their impact on entrepreneurship. In testing the above hypotheses, we are able to merge two streams of the literature, namely the literature that studies the economic consequences of disease epidemics (e.g., Becker 1990 ; Raddatz 2007 ; Jordá et al 2020 ; Bloom and Mahal 1997 ; Barro et al 2020 ) and the literature that explores the drivers of entrepreneurial activity (e.g., Bjørnskov and Foss 2008 ; Saunoris and Sajny 2017 ; Cebula et al 2015 ; Boudreaux et al 2019 ; Chambers and Munemo 2019 ).…”

Section: Theoretical Considerations and Hypothesesmentioning

confidence: 99%

“…Regulations are another important factor in the decision to become an entrepreneur. Regulatory barriers make it difficult for new entrepreneurs to enter the market; however, the quality regulations may prove beneficial to entrepreneurs (Chambers and Munemo 2019 ). Lastly, we control for education such that greater enrollment in schools, especially at the tertiary level, benefits potential entrepreneurs by providing them with the knowledge and skills to navigate the complexities of starting a business; however, this also raises the opportunity cost of being an entrepreneur given their high skills makes them more marketable in the labor market.…”

Section: Data and Empirical Modelmentioning

confidence: 99%

Do Disease Epidemics Stimulate or Repress Entrepreneurial Activity?

Berdiev

Saunoris

2021

Eastern Econ J

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This study addresses a unique angle by examining an under looked determinant of entrepreneurship related to disease epidemics. In times of natural disasters, such as disease epidemics, new demands emerge that might promote entrepreneurship. Using data on a large cross section of countries, we empirically test whether and to what extent the incidence and severity of disease epidemics affect the prevalence of entrepreneurship. The results show that both the occurrence and severity of epidemics spur entrepreneurial activity. These results highlight a potentially important role served by entrepreneurs in responding to biological disasters. Our findings withstand a series of robustness checks.

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Regulations, institutional quality and entrepreneurship

Cited by 66 publications

References 29 publications

The role of innovation and institutions in entrepreneurship and economic growth in two groups of countries

The role of innovation and institutions in entrepreneurship and economic growth in two groups of countries

Effect of AfT flows on Investment-Oriented Remittances flows

Do Disease Epidemics Stimulate or Repress Entrepreneurial Activity?

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