Regulations, institutional quality and entrepreneurship

This paper examines the impact of startup regulations and institutional quality on the level of new business activity in a panel of 119 countries between 2001 and 2012. We find robust evidence that new business creation is significantly lower in countries with excessive barriers to entry, a lack of...

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Bibliographic Details
Published inJournal of regulatory economics Vol. 55; no. 1; pp. 46 - 66
Main Authors Chambers, Dustin, Munemo, Jonathan
Format Journal Article
LanguageEnglish
Published New York Springer US 01.02.2019
Springer Nature B.V
Subjects
Business
Deviation
Economics
Economics and Finance
Entrepreneurs
Entrepreneurship
Industrial Organization
Microeconomics
Original Article
Public Finance
Regulation
D73
L26
C23
Entrepreneurship
L51
Regulation
Governance
Institutions
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ISSN0922-680X
1573-0468
DOI10.1007/s11149-019-09377-w

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Summary:This paper examines the impact of startup regulations and institutional quality on the level of new business activity in a panel of 119 countries between 2001 and 2012. We find robust evidence that new business creation is significantly lower in countries with excessive barriers to entry, a lack of high-quality governmental institutions, or both. Specifically, increasing by one, the number of steps required to start a new business, reduces entrepreneurial activity between 3 and 7%. Furthermore, a one standard deviation increase in the overall average level of institutional quality is associated with a 34% increase in new business activity.
Bibliography:ObjectType-Article-1
SourceType-Scholarly Journals-1
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ISSN:0922-680X
1573-0468
DOI:10.1007/s11149-019-09377-w