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The Political Economy of Entrepreneurship

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Author Info

  • Douhan, Robin

    (Research Institute of Industrial Economics (IFN))

  • Henrekson, Magnus

    ()
    (Research Institute of Industrial Economics (IFN))

Abstract

We outline a politico-economic growth system centered around the entrepreneur. By defining entrepreneurs in relation to economic rents we are able to develop a more general theory comprising central aspects of research within the fields of entrepreneurship/small business, public choice and new institutional economics. The entrepreneurial function is shown to depend crucially on the existing institutional framework. We also point to the necessity of viewing institutions as endogenously influenced by entrepreneurs. A typology of entrepreneurship is developed to further our understanding of the bilateral effects between institutional context and entrepreneurial activity. We use developments in modern history as a real-world context to substantiate our framework. Particular attention is devoted to the effects of enforcement of property rights and taxation, two of the most prominent institutions in the literature.

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Bibliographic Info

Paper provided by Research Institute of Industrial Economics in its series Working Paper Series with number 716.

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Length: 28 pages
Date of creation: 05 Sep 2007
Date of revision:
Handle: RePEc:hhs:iuiwop:0716

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Postal: Research Institute of Industrial Economics, Box 55665, SE-102 15 Stockholm, Sweden
Phone: +46 8 665 4500
Fax: +46 8 665 4599
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Web page: http://www.ifn.se/
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Related research

Keywords: Entrepreneurship; Industrial Policy; Innovation; Property Rights; Regulation; Self-employment; Tax Policy;

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References

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  1. Martin Feldstein & Joel Slemrod, 1980. "Personal Taxation, Portfolio Choice and The Effect of the Corporation Income Tax," NBER Working Papers 0241, National Bureau of Economic Research, Inc.
  2. Acemoglu, Daron & Robinson, James A, 2006. "Persistence of Power, Elites and Institutions," CEPR Discussion Papers 5603, C.E.P.R. Discussion Papers.
  3. Davis, Steven J. & Henrekson, Magnus, 1995. "Industrial Policy, Employer Size and Economic Performance in Sweden," Working Paper Series 436, Research Institute of Industrial Economics.
  4. Robert E. Hall & Charles I. Jones, 1999. "Why Do Some Countries Produce So Much More Output per Worker than Others?," NBER Working Papers 6564, National Bureau of Economic Research, Inc.
  5. Acemoglu, Daron & Johnson, Simon & Robinson, James A., 2005. "Institutions as a Fundamental Cause of Long-Run Growth," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 6, pages 385-472 Elsevier.
  6. Henrekson, Magnus, 2002. "Entrepreneurship: A Weak Link in the Welfare State," Working Paper Series in Economics and Finance 518, Stockholm School of Economics, revised 04 Mar 2005.
  7. Oriana Bandiera, 2003. "Land Reform, the Market for Protection, and the Origins of the Sicilian Mafia: Theory and Evidence," Journal of Law, Economics and Organization, Oxford University Press, vol. 19(1), pages 218-244, April.
  8. Rodrik, Dani & Alesina, Alberto, 1994. "Distributive Politics and Economic Growth," Scholarly Articles 4551798, Harvard University Department of Economics.
  9. Baumol, William J, 1990. "Entrepreneurship: Productive, Unproductive, and Destructive," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 893-921, October.
  10. Simeon Djankov & Yingyi Qian & Gérard Roland & Ekaterina Zhuravskaya, 2006. "Entrepreneurship in China and Russia Compared," Journal of the European Economic Association, MIT Press, vol. 4(2-3), pages 352-365, 04-05.
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  29. repec:cto:journl:v:24:y:2004:i:3:p: is not listed on IDEAS
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Cited by:
  1. Delmar, Frédéric & Wennberg, Karl & Hellerstedt, Karin, 2011. "Endogenous growth through knowledge spillovers in entrepreneurship: An empirical test," Ratio Working Papers 165, The Ratio Institute.

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