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The Institutions of Economic Freedom and Entrepreneurship: Evidence from Panel Data

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  • Nyström, Kristina

    () (The Ratio Institute)

Abstract

This paper provides new evidence on the determinants of entrepreneurship across countries. The paper investigates the relationship between the institutional setting, in terms of economic freedom, and entrepreneurship, as measured by self-employment in a panel data setting covering 23 OECD countries and the time-period 1972-2002. The measure of economic freedom includes five aspects: size of government, legal structure and security of property rights, access to sound money, freedom to trade internationally, and the regulation of credit, labour and business. The empirical findings show that a smaller government sector, better legal structure and security of property rights and less regulation of credit, labour and business tend to increase entrepreneurship.

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Bibliographic Info

Paper provided by The Ratio Institute in its series Ratio Working Papers with number 114.

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Length: 28 pages
Date of creation: 03 Jan 2008
Date of revision:
Publication status: Published in Public Choice, 2008, pages 269-282.
Handle: RePEc:hhs:ratioi:0114

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Postal: The Ratio Institute, P.O. Box 5095, SE-102 42 Stockholm, Sweden
Phone: 08-441 59 00
Fax: 08-441 59 29
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Web page: http://www.ratio.se/
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Keywords: entrepreneurship; self-employment; institutions; economic freedom;

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References

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  1. Roy Thurik & Andreas Freytag, 2006. "Entrepreneurship and its determinants in a cross-country setting," Scales Research Reports H200616, EIM Business and Policy Research.
  2. Stefano Scarpetta & Philip Hemmings & Thierry Tressel & Jaejoon Woo, 2002. "The Role of Policy and Institutions for Productivity and Firm Dynamics: Evidence from Micro and Industry Data," OECD Economics Department Working Papers 329, OECD Publishing.
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  24. Lee, L W, 1991. "Entrepreneurship and Regulation: Dynamics and Political Economy," Journal of Evolutionary Economics, Springer, vol. 1(3), pages 219-35, July.
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Citations

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Cited by:
  1. Almas Heshmati & Dan Johansson & Carl Magnus Bjuggren, 2010. "Effective Corporate Tax Rates and the Size Distribution of Firms," Journal of Industry, Competition and Trade, Springer, vol. 10(3), pages 297-317, September.
  2. Pete, Stefan & Nagy, Agnes & Matis, Dumitru & Gyorfy, Lehel Zoltan & Benyovszki, Annamaria & Petru, Tunde Petra, 2011. "Early-stage entrepreneurial aspirations in efficiency-driven economies," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(2), pages 5-18, June.
  3. Túlio A. Cravo & Adrian Gourlay & Bettina Becker, 2010. "SMEs and Regional Economic Growth in Brazil," Discussion Paper Series 2010_01, Department of Economics, Loughborough University, revised Jan 2010.
  4. Concepción Román & Emilio Congregado & José Millán, 2011. "Dependent self-employment as a way to evade employment protection legislation," Small Business Economics, Springer, vol. 37(3), pages 363-392, October.
  5. Humphreys, Brad & Maresova, Katerina & Ruseski, Jane, 2012. "Institutional Factors, Sport Policy, and Individual Sport Participation: An International Comparison," Working Papers 2012-1, University of Alberta, Department of Economics.
  6. André van Stel & J. Cieslik Cieslik, 2012. "Trends in Entrepreneurial Activity in Central and East European Transition Economies," Scales Research Reports H201202, EIM Business and Policy Research.

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