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Is More Entrepreneurship better?

Author

Listed:
  • Philipp Koellinger

    (Erasmus University Rotterdam)

  • Christian Roessler

    (Brown University)

Abstract

We develop a new perspective on the boundary of the firm that is consistent with the empirical observation that the share of entrepreneurs first decreases and then increases in the course of economic development. Existing theory based on transaction costs is difficult to relate to these well-established dynamics. Our approach focuses on changing incentives to specialize and adapt, in order to access complementarities that arise from diverse abilities and access to wealth. We discuss why the efficient number of entrepreneurs is bounded and changes in the course of economic development.

Suggested Citation

  • Philipp Koellinger & Christian Roessler, 2009. "Is More Entrepreneurship better?," Tinbergen Institute Discussion Papers 09-105/3, Tinbergen Institute, revised 03 Dec 2009.
  • Handle: RePEc:tin:wpaper:20090105
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    References listed on IDEAS

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    More about this item

    Keywords

    Entrepreneurship; theory of the firm; organizations; economic development;

    JEL classification:

    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • D20 - Microeconomics - - Production and Organizations - - - General
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General

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