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Religion and Entrepreneurship

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  • Audretsch, David B
  • Bönte, Werner
  • Tamvada, Jagannadha Pawan

Abstract

While considerable concern has emerged about the impact of religion on economic development, little is actually known about how religion impacts the decision making of individuals. This paper examines the influence of religion on the decision for people to become an entrepreneur. Based on a large-scale data set of nearly ninety thousand workers in India, this paper finds that religion shapes the entrepreneurial decision. In particular, some religions, such as Islam and Christianity, are found to be conducive to entrepreneurship, while others, such as Hinduism, inhibit entrepreneurship. In addition, the caste system is found to influence the propensity to become an entrepreneur. Individuals belonging to a backward caste exhibit a lower propensity to become an entrepreneur. Thus, the empirical evidence suggests that both religion and the tradition of the caste system influence entrepreneurship, suggesting a link between religion and economic behaviour.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 6378.

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Date of creation: Jul 2007
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Handle: RePEc:cpr:ceprdp:6378

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Keywords: caste-system; entrepreneurship; India; religion;

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Cited by:
  1. Stefan Buehler & Christian Kaiser & Franz Jaeger, 2012. "The geographic determinants of bankruptcy: evidence from Switzerland," Small Business Economics, Springer, vol. 39(1), pages 231-251, July.
  2. Maryam Dilmaghani, 2012. "Global financial crisis: dharmic transgressions and solutions," International Journal of Social Economics, Emerald Group Publishing, vol. 39(1), pages 55-80, January.
  3. Tamvada, Jagannadha Pawan, 2010. "The Dynamics of Self-employment in a Developing Country: Evidence from India," MPRA Paper 20042, University Library of Munich, Germany.
  4. Faria, João Ricardo & Cuestas, Juan Carlos & Mourelle, Estefanía, 2010. "Entrepreneurship and unemployment: A nonlinear bidirectional causality?," Economic Modelling, Elsevier, vol. 27(5), pages 1282-1291, September.
  5. Nunziata, Luca & Rocco, Lorenzo, 2011. "The Implications of Cultural Background on Labour Market Choices: The Case of Religion and Entrepreneurship," IZA Discussion Papers 6114, Institute for the Study of Labor (IZA).
  6. Yaron Zelekha & Gil Avnimelech & Eyal Sharabi, 2014. "Religious institutions and entrepreneurship," Small Business Economics, Springer, vol. 42(4), pages 747-767, April.
  7. Klapper, Leora & Love, Inessa & Randall, Douglas, 2014. "New firm registration and the business cycle," Policy Research Working Paper Series 6775, The World Bank.
  8. Filipe R. Campante & David H. Yanagizawa-Drott, 2013. "Does Religion Affect Economic Growth and Happiness? Evidence from Ramadan," NBER Working Papers 19768, National Bureau of Economic Research, Inc.
  9. Baele, Lieven & Farooq, Moazzam & Ongena, Steven, 2011. "Of Religion and Redemption: Evidence from Default on Islamic Loans," CEPR Discussion Papers 8504, C.E.P.R. Discussion Papers.
  10. Anja Koebrich Leon, 2013. "Religion and Economic Outcomes – Household Savings Behavior in the USA," Working Paper Series in Economics 268, University of Lüneburg, Institute of Economics.
  11. Rietveld, C.A. & van Burg, E., 2013. "Religious beliefs and entrepreneurship among Dutch protestants," ERIM Report Series Research in Management ERS-2013-015-STR, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus Uni.
  12. A Aggarwal & R Freguglia & G Johnes & G Spricigo, 2011. "Education and labour market outcomes : evidence from India," Working Papers 615663, Lancaster University Management School, Economics Department.
  13. Henley, Andrew, 2014. "Is Religion Associated with Entrepreneurial Activity?," IZA Discussion Papers 8111, Institute for the Study of Labor (IZA).

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