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Who Creates Jobs?

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Author Info

  • Ejaz Ghani
  • William R. Kerr
  • Stephen D. O'Connell

Abstract

There is a consensus that jobs are vital in translating economic growth into lasting poverty reduction and social cohesion. But who creates jobs is an understudied field. This Economic Premise argues that there is a strong link between initial levels of young and small firms and subsequent job growth, as evidenced in India. The economic geography of entrepreneurship in India is still evolving. It is worrying that there are too few entrepreneurs in India for its stage of development. Yet there is no question that entrepreneurship works—cities and states that have embraced entrepreneurship have created more jobs. However, the link between entrepreneurship and job growth is not automatic. Cities that have a higher quality of physical infrastructure and a more educated workforce attract many more entrepreneurs. Supportive incumbent industrial structures for input and output markets are strongly linked to higher entrepreneurship rates. There are many policy levers that can be used by policy makers to promote entrepreneurial growth. Instead of being preoccupied with firm chasing—attracting large mature firms from other locations—policy makers should focus on encouraging entrepreneurship in their communities.

(This abstract was borrowed from another version of this item.)

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Bibliographic Info

Paper provided by The World Bank in its series World Bank Other Operational Studies with number 10072.

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Date of creation: Nov 2011
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Handle: RePEc:wbk:wboper:10072

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Keywords: Infrastructure Economics and Finance - Private Participation in Infrastructure Social Protections and Labor - Labor Markets Finance and Financial Sector Development - Microfinance Water Resources - Water and Industry Small Scale Enterprise Industry;

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References

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  1. Edward Glaeser & William Kerr, 2008. "Local Industrial Conditions and Entrepreneurship: How Much of the Spatial Distribution Can We Explain?," Working Papers 08-37, Center for Economic Studies, U.S. Census Bureau.
  2. Mercedes Delgado & Michael E. Porter & Scott Stern, 2010. "Clusters and entrepreneurship," Journal of Economic Geography, Oxford University Press, vol. 10(4), pages 495-518, July.
  3. David E. Bloom & David Canning & Jocelyn E. Finlay, 2008. "Demographic Change and Economic Growth in Asia," PGDA Working Papers 4108, Program on the Global Demography of Aging.
  4. William R. Kerr & Ramana Nanda, 2009. "Financing Constraints and Entrepreneurship," Harvard Business School Working Papers 10-013, Harvard Business School.
  5. John Haltiwanger & Ron S. Jarmin & Javier Miranda, 2010. "Who Creates Jobs? Small vs. Large vs. Young," Working Papers 10-17, Center for Economic Studies, U.S. Census Bureau.
  6. Jovanovic, Boyan & MacDonald, Glenn M, 1994. "The Life Cycle of a Competitive Industry," Journal of Political Economy, University of Chicago Press, vol. 102(2), pages 322-47, April.
  7. Edward L. Glaeser & Stuart S. Rosenthal & William C, Strange, 2010. "Urban Economics and Entrepreneurship," NBER Chapters, in: Cities and Entrepreneurship National Bureau of Economic Research, Inc.
  8. Mercedes Delgado & Michael Porter & Scott Stern, 2010. "Clusters and Entrepreneurship," Working Papers 10-31, Center for Economic Studies, U.S. Census Bureau.
  9. William Kerr & Ramana Nanda, 2006. "Democratizing Entry: Banking Deregulations, Financing Constraints, and Entrepreneurship," Harvard Business School Working Papers 07-033, Harvard Business School, revised Oct 2008.
  10. Ghani, Ejaz (ed.), 2011. "Reshaping Tomorrow: Is South Asia Ready for the Big Leap?," OUP Catalogue, Oxford University Press, number 9780198075028.
  11. Arvind Virmani & Danish A Hashim, 2011. "J-Curve of Productivity and Growth," IMF Working Papers 11/163, International Monetary Fund.
  12. Demirguc-Kunt, Asli & Klapper, Leora F. & Panos, Georgios A., 2009. "Entrepreneurship in post-conflict transition : the role of informality and access to finance," Policy Research Working Paper Series 4935, The World Bank.
  13. Ejaz Ghani, 2011. "Reshaping Tomorrow : Is South Asia Ready for the Big Leap?," World Bank Publications, The World Bank, number 16360, October.
  14. Edward L. Glaeser, 2007. "Entrepreneurship and the City," NBER Working Papers 13551, National Bureau of Economic Research, Inc.
  15. R. Jason Faberman, 2007. "The relationship between the establishment age distribution and urban growth," Working Papers 07-18, Federal Reserve Bank of Philadelphia.
  16. Anne Krueger, 2011. "Comments on "New Structural Economics"; by Justin Yifu Lin," World Bank Research Observer, World Bank Group, vol. 26(2), pages 222-226, August.
  17. Audretsch, David B. & Keilbach, Max C. & Lehmann, Erik E., 2006. "Entrepreneurship and Economic Growth," OUP Catalogue, Oxford University Press, number 9780195183511.
  18. Ayyagari, Meghana & Demirguc-Kunt, Asli & Maksimovic, Vojislav, 2011. "Small vs. young firms across the world : contribution to employment, job creation, and growth," Policy Research Working Paper Series 5631, The World Bank.
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Cited by:
  1. Marco Vivarelli, 2013. "Is entrepreneurship necessarily good? Microeconomic evidence from developed and developing countries," Industrial and Corporate Change, Oxford University Press, vol. 22(6), pages 1453-1495, December.

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