DP8247 Which Institutions Encourage Entrepreneurs to Create Larger Firms?

Author(s): Saul Estrin, Julia Korosteleva, Tomasz Mickiewicz
Publication Date: February 2011
Keyword(s): Corruption, Entrepreneurship, Global Entrepreneurship Monitor, Government, Institutions, Property Rights
JEL(s): D23, D84, J24, L26, P11
Programme Areas: Labour Economics
Link to this Page: www.cepr.org/active/publications/discussion_papers/dp.php?dpno=8247

We develop entrepreneurship and institutional theory to explain variation in different types of entrepreneurship across individuals and institutional contexts. Our framework generates hypotheses about the negative impact of higher levels of corruption, weaker property rights and especially intellectual property rights, and a larger state on entrepreneurs who plan to grow faster. We test these hypotheses using the Global Entrepreneurship Monitor surveys in 55 countries for 2001-2006, applying a multilevel estimation framework. We confirm our main hypotheses but we find no significant impact from intellectual property rights.