Sustaining Entrepreneurial Capitalism

Baumöl, William J.; Litan, Robert E.; Schramm, Carl J.

doi:10.2202/1932-0213.1026

“…Baumol et al (2007) argue against welfare provision based on employment status as this discourages movements from employment towards entrepreneurship. Thus, some of the key policy discussions with respect to the state sector and entrepreneurship should be about its design as well as its size.…”

Section: )mentioning

confidence: 99%

Size matters: entrepreneurial entry and government

Aidis

¹

,

Estrin

²

,

Mickiewicz

³

2010

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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.

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“…Although concerns that health insurance costs are "killing new-business dreams" (Egerstrom 2007;Keen, 2005) and that health insurance issues distort employment choices to the detriment of start-ups (Leonhardt, 2009, Baumol, Litan andSchramm 2007) have been voiced for several years, the issue has taken on a new salience with the passage of the Patient Protection and Affordable Care Act of 2010 (PPACA). In the debate leading up to the passage of PPACA, President Obama noted the concern: "This is something I hear about from entrepreneurs I meet -people who've got a good idea, and the expertise and determination to build it into a thriving business.…”

Section: Introductionmentioning

confidence: 99%

Is employer-based health insurance a barrier to entrepreneurship?

Fairlie

¹

,

Kapur

²

,

Gates

³

2011

Journal of Health Economics

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The focus on employer-provided health insurance in the United States may restrict business creation. We address the limited research on the topic of "entrepreneurship lock" by using recent panel data from matched Current Population Surveys. We use difference-indifference models to estimate the interaction between having a spouse with employer-based health insurance and potential demand for health care. We find evidence of a larger negative effect of health insurance demand on business creation for those without spousal coverage than for those with spousal coverage. We also take a new approach in the literature to examine the question of whether employer-based health insurance discourages business creation by exploiting the discontinuity created at age 65 through the qualification for Medicare. Using a novel procedure of identifying age in months from matched monthly CPS data, we compare the probability of business ownership among male workers in the months just before turning age 65 and in the months just after turning age 65. We find that business ownership rates increase from just under age 65 to just over age 65, whereas we find no change in business ownership rates from just before to just after for other ages 55-75. We also do not find evidence from the previous literature and additional estimates that other confounding factors such as retirement, partial retirement, social security and pension eligibility are responsible for the increase in business ownership in the month individuals turn 65. Our estimates provide some evidence that "entrepreneurship lock" exists, which raises concerns that the bundling of health insurance and employment may create an inefficient level of business creation.

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“…Although concerns that health insurance costs are "killing new-business dreams" (Egerstrom 2007;Keen, 2005) and that health insurance issues distort employment choices to the detriment of start-ups (Leonhardt, 2009, Baumol, Litan andSchramm 2007) have been voiced for several years, the issue has taken on a new salience with the passage of the Patient Protection and Affordable Care Act of 2010 (PPACA). In the debate leading up to the passage of PPACA, President Obama noted the concern:…”

Section: Introductionmentioning

confidence: 99%

Is Employer-Based Health Insurance a Barrier to Entrepreneurship?

Fairlie

¹

,

Kapur

²

,

Gates

³

2008

View full text Add to dashboard Cite

The focus on employer-provided health insurance in the United States may restrict business creation. We address the limited research on the topic of "entrepreneurship lock" by using recent panel data from matched Current Population Surveys. We use difference-indifference models to estimate the interaction between having a spouse with employer-based health insurance and potential demand for health care. We find evidence of a larger negative effect of health insurance demand on business creation for those without spousal coverage than for those with spousal coverage. We also take a new approach in the literature to examine the question of whether employer-based health insurance discourages business creation by exploiting the discontinuity created at age 65 through the qualification for Medicare. Using a novel procedure of identifying age in months from matched monthly CPS data, we compare the probability of business ownership among male workers in the months just before turning age 65 and in the months just after turning age 65. We find that business ownership rates increase from just under age 65 to just over age 65, whereas we find no change in business ownership rates from just before to just after for other ages 55-75. We also do not find evidence from the previous literature and additional estimates that other confounding factors such as retirement, partial retirement, social security and pension eligibility are responsible for the increase in business ownership in the month individuals turn 65. Our estimates provide some evidence that "entrepreneurship lock" exists, which raises concerns that the bundling of health insurance and employment may create an inefficient level of business creation.

show abstract

Sustaining Entrepreneurial Capitalism

Cited by 50 publications

References 0 publications

Size matters: entrepreneurial entry and government

Size matters: entrepreneurial entry and government

Is employer-based health insurance a barrier to entrepreneurship?

Is Employer-Based Health Insurance a Barrier to Entrepreneurship?

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