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Politics and Entrepreneurial Activity in the U.S

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Abstract

There is a strong belief that Republicans are more pro-business than Democrats. In this paper, we investigate the causal impact of partisan allegiance of governors (Republican or Democratic) on business creation using entrepreneurship data constructed from the Census Population Surveys and establishment creation data from the Business Dynamics Statistics. By exploiting random variation in close gubernatorial elections in 50 states over the last three decades in a Regression Discontinuity design, we find, surprisingly, that Republicans are not different than Democrats in business creation. Our findings are robust to a number of different specifications, samples, and controls.

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  • Louis-Philippe Beland & Ozkan Eren & Bulent Unel, 2015. "Politics and Entrepreneurial Activity in the U.S," Departmental Working Papers 2015-04, Department of Economics, Louisiana State University.
    • Handle: RePEc:lsu:lsuwpp:2015-04
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    Cited by:

    1. Louis-Philippe Beland, 2016. "Political Parties and Economic Outcomes. A Review," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 14(1), pages 47-54, 05.

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