Credit Constraints, Entrepreneurial Talent, and Economic Development
AbstractIn this paper, we formalize the view that economic development requires high rates of productive entrepreneurship, and this requires an efficient matching between entrepreneurial talent and production echnologies. We first explore the role of financial development in promoting such efficient allocation of talent, which results in higher production, job creation and social mobility. We then show how different levels of financial development may endogenously arise in a setting in which financial constraints depend on individual incentives to misbehave, these incentives depend on how many jobs are available, and this in turn depends on the level of financial development. Such complementarity between labour market and financial marketdevelopment may generate highly divergent development paths even for countries with very similar initial
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Bibliographic InfoPaper provided by World Institute for Development Economic Research (UNU-WIDER) in its series Working Papers with number UNU-WIDER Research Paper RP2009/20.
Date of creation: 2009
Date of revision:
credit constraints; allocation of entrepreneurial talent; productive and unproductive entrepreneurs; economic development;
Other versions of this item:
- Milo Bianchi, 2010. "Credit constraints, entrepreneurial talent, and economic development," Small Business Economics, Springer, vol. 34(1), pages 93-104, January.
- Milo Bianchi, 2010. "Credit Constraints, Entrepreneurial Talent, and Economic Development," Post-Print halshs-00636002, HAL.
- Bianchi, Milo, 2010. "Credit constraints, entrepreneurial talent, and economic development," Open Access publications from UniversitÃ© Paris-Dauphine urn:hdl:123456789/5381, Université Paris-Dauphine.
- O16 - Economic Development, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
- L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-08-16 (All new papers)
- NEP-DEV-2009-08-16 (Development)
- NEP-ENT-2009-08-16 (Entrepreneurship)
- NEP-HRM-2009-08-16 (Human Capital & Human Resource Management)
- NEP-SBM-2009-08-16 (Small Business Management)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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