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Entrepreneurs' Acceptance of Formal Institutions: A Cross-country Analysis

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  • Andreas Freytag

    ()
    (Friedrich-Schiller-University Jena, School of Economics and Business Administration)

  • Florian Noseleit

    ()
    (European Centre for International Political Economy (ECIPE))

Abstract

Institutional settings and the resulting incentive structures are crucial for economic development. The type of entrepreneurial activity and the entrepreneurial effort are especially dependent on underlying incentive structures. We argue that institutions with better incentive structures for entrepreneurs are perceived as being of higher quality by this group. We find empirical evidence that high institutional quality increases the willingness of the self-employed to accept these institutions. Furthermore, institutional quality affects the deviation in acceptance of self-employed to non-self-employed such that lower institutional quality is related to less acceptance by entrepreneurs compared to the rest of society.

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Bibliographic Info

Paper provided by Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics in its series Jena Economic Research Papers with number 2009-047.

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Date of creation: 02 Jul 2009
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Handle: RePEc:jrp:jrpwrp:2009-047

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Keywords: Entrepreneurship; self-employment; institutions; cross-country study;

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