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Post-Socialist Culture and Entrepreneurship

  • Petrik Runst
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    In this paper it is argued that locus of control beliefs and preferences concerning state action negatively affect the formation of new firms in former socialist countries. For this purpose Kirzner's theory of costless entrepreneurship is reviewed and criticized. German reunification, in which the formerly Socialist East joined the Federal Republic of Germany, represents an intriguing natural experiment in which the formal institutional structure of one nation was almost fully transplanted into another. Traditional as well as psychological factors are examined. The results suggest that about one third of the east-west gap in new self-employment can be explained by inert informal institutions.

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    File URL: http://www.diw.de/documents/publikationen/73/diw_01.c.372553.de/diw_sp0373.pdf
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    Paper provided by DIW Berlin, The German Socio-Economic Panel (SOEP) in its series SOEPpapers on Multidisciplinary Panel Data Research with number 373.

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    Length: 32 p.
    Date of creation: 2011
    Handle: RePEc:diw:diwsop:diw_sp373
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    1. Easton, Stephen T & Walker, Michael A, 1997. "Income, Growth, and Economic Freedom," American Economic Review, American Economic Association, vol. 87(2), pages 328-32, May.
    2. Zoltan Acs & Pamela Mueller, 2006. "Employment effects of business dynamics: Mice, Gazelles and Elephants," Papers on Entrepreneurship, Growth and Public Policy 2006-23, Max Planck Institute of Economics, Entrepreneurship, Growth and Public Policy Group.
    3. repec:zbw:iwhdps:186 is not listed on IDEAS
    4. Mark Casson & Nigel Wadeson, 2007. "The Discovery of Opportunities: Extending the Economic Theory of the Entrepreneur," Small Business Economics, Springer, vol. 28(4), pages 285-300, April.
    5. Earle, John S. & Sakova, Zuzana, 2000. "Business start-ups or disguised unemployment? Evidence on the character of self-employment from transition economies," Labour Economics, Elsevier, vol. 7(5), pages 575-601, September.
    6. Bengoa, Marta & Sanchez-Robles, Blanca, 2003. "Foreign direct investment, economic freedom and growth: new evidence from Latin America," European Journal of Political Economy, Elsevier, vol. 19(3), pages 529-545, September.
    7. G. Reza Arabsheibani & David de Meza & John Maloney & Bernard Pearson, 2000. "And a Vision Appeared unto them of a Great Profit: Evidence of Self-Deception among the Self-Employed," Royal Holloway, University of London: Discussion Papers in Economics 99/9, Department of Economics, Royal Holloway University of London, revised Feb 2000.
    8. Ruta Aidis & Saul Estrin & Tomasz Marek Mickiewicz, 2007. "Institutions and Entrepreneurship Development in Russia: A Comparative Perspective," UCL SSEES Economics and Business working paper series 79, UCL School of Slavonic and East European Studies (SSEES).
    9. Peter J. Boettke & Christopher J. Coyne & Peter T. Leeson, 2008. "Institutional Stickiness and the New Development Economics," American Journal of Economics and Sociology, Wiley Blackwell, vol. 67(2), pages 331-358, 04.
    10. George A. Akerlof & Rachel E. Kranton, 2000. "Economics and Identity," The Quarterly Journal of Economics, Oxford University Press, vol. 115(3), pages 715-753.
    11. Alberto Chong & Jorge Guillen & Vanessa Rios, 2010. "Language Nuances and Socioeconomic Outcomes," American Journal of Economics and Sociology, Wiley Blackwell, vol. 69(2), pages 693-716, 04.
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