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A Model of Destructive Entrepreneurship

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  • Desai,Sameeksha, Acs, Zoltan and Weitzel, Utz

Abstract

The current research on entrepreneurship as an economic phenomenon often assumes its desirability as a driver of economic development and growth. However, entrepreneurial talent can be allocated among productive, unproductive, and destructive activities. This process is theorized as driven by institutions. Although the tradeoff between productive and unproductive entrepreneurship has been examined, destructive entrepreneurship has been largely ignored. We build from existing theory and define destructive entrepreneurship as wealth-destroying. We propose three assumptions to develop a model of destructive entrepreneurship that presents the mechanisms through which entrepreneurial talent behaves in this manner. We present four key propositions on the nature and behavior of destructive entrepreneurship. We conclude by identifying policy and research streams that emerge from our model.

Suggested Citation

  • Desai,Sameeksha, Acs, Zoltan and Weitzel, Utz, 2010. "A Model of Destructive Entrepreneurship," WIDER Working Paper Series 034, World Institute for Development Economic Research (UNU-WIDER).
  • Handle: RePEc:unu:wpaper:wp2010-34
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    Cited by:

    1. Besnik A. Krasniqi & Sameeksha Desai, 2016. "Institutional drivers of high-growth firms: country-level evidence from 26 transition economies," Small Business Economics, Springer, vol. 47(4), pages 1075-1094, December.
    2. repec:spr:intemj:v:13:y:2017:i:3:d:10.1007_s11365-016-0427-2 is not listed on IDEAS
    3. Zoltán J. Ács & Mary C. Boardman & Connie L. McNeely, 2015. "The social value of productive entrepreneurship," Chapters,in: Global Entrepreneurship, Institutions and Incentives, chapter 3, pages 42-53 Edward Elgar Publishing.
    4. Sanders, Mark & Weitzel, Utz, 2010. "The Allocation of Entrepreneurial Talent and Destructive Entrepreneurship," WIDER Working Paper Series 046, World Institute for Development Economic Research (UNU-WIDER).
    5. Jamie D. Collins & Jeffery S. McMullen & Christopher R. Reutzel, 2016. "Distributive justice, corruption, and entrepreneurial behavior," Small Business Economics, Springer, vol. 47(4), pages 981-1006, December.
    6. Vladimirov, Zhelyu & Simeonova-Ganeva, Ralitsa & Ganev, Kaloyan, 2012. "Interaction of leading and supporting factors for the SME competitiveness," MPRA Paper 37251, University Library of Munich, Germany.
    7. Frank R. Gunter, 2013. "The Political Economy of Iraq," Books, Edward Elgar Publishing, number 14293.
    8. Michael, Bryane, 2017. "The Effect of Competition Law on Brunei’s Small and Medium Enterprises," EconStor Preprints 169114, ZBW - German National Library of Economics.
    9. Frank R. Gunter, 2012. "A Simple Model of Entrepreneurship for Principles of Economics Courses," The Journal of Economic Education, Taylor & Francis Journals, vol. 43(4), pages 386-396, October.
    10. Radosevic, Slavo & Yoruk, Esin, 2013. "Entrepreneurial propensity of innovation systems: Theory, methodology and evidence," Research Policy, Elsevier, vol. 42(5), pages 1015-1038.
    11. Marcus Dejardin & Helene Laurent, 2014. "Greasing the wheels of entrepreneurship? A complement according to entrepreneurial motives," Working Papers 1402, University of Namur, Department of Economics.
    12. Tilman Brück & Patricia Justino & Charles Patrick MartinShields, 2017. "Conflict and development: Recent research advances and future agendas," WIDER Working Paper Series 178, World Institute for Development Economic Research (UNU-WIDER).
    13. Colin O’Reilly, 2014. "Investment and Institutions in Post-Civil War Recovery," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 56(1), pages 1-24, March.
    14. Maksim Belitski & Farzana Chowdhury & Sameeksha Desai, 2016. "Taxes, corruption, and entry," Small Business Economics, Springer, vol. 47(1), pages 201-216, June.
    15. Maksim Belitski & Sameeksha Desai, 2016. "What drives ICT clustering in European cities?," The Journal of Technology Transfer, Springer, vol. 41(3), pages 430-450, June.
    16. Jonathan Levie & Erkko Autio & Zoltan Acs & Mark Hart, 2014. "Global entrepreneurship and institutions: an introduction," Small Business Economics, Springer, vol. 42(3), pages 437-444, March.

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    Keywords

    destructive entrepreneurship; entrepreneurship; allocation; rent-seeking; incentives; informal institutions;

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