Policies aimed at encouraging entrepreneurship are popular around the world, but a recent literature suggests that entrepreneurship might be more predetermined than previously thought. This column uses sibling correlations to tease apart the importance of genes, family background, and neighbourhood effects for later entrepreneurship. Parental entrepreneurship and genes are the two main drivers of sibling similarities in entrepreneurship. However, children do appear to be able to learn about entrepreneurship through their family and community, so it may be possible to teach relevant skills to young people.
Matthew Lindquist, Joeri Sol, Mirjam van Praag, Theodor Vladasel, 02 December 2016
Sari Pekkala Kerr, William Kerr, 10 August 2016
Increased hostility to immigration has been a key driver of the rise of right-wing populist movements across the world. At the same time, local governments – notably in the US – have designed work programmes to attract immigrant entrepreneurs to their areas. This column explores the types of businesses founded by immigrants and their growth patterns, and examines how these outcomes relate to immigrants’ age at arrival to the US. Immigrant entrepreneurs experience greater volatility – they fail more frequently, but those that persist experience greater employment growth than their native counterparts.
Luigi Guiso, Luigi Pistaferri, Fabiano Schivardi, 03 April 2016
Entrepreneurship often concentrates in certain geographic locations, with Silicon Valley the most famous example today. While a large literature focuses on these cross-location differences in entrepreneurial density, questions remain about the supply of entrepreneurial skills across locations. Using Italian data, this column investigates whether selection into entrepreneurship is affected by learning opportunities in adolescence. Those who grow up in an area with higher entrepreneurial density are found to be more likely to become entrepreneurs themselves. They are also more likely to succeed and earn a higher income.
Ryan Decker, John Haltiwanger, Ron Jarmin, Javier Miranda, 19 March 2016
Recent evidence suggests that transformational entrepreneurial firms – those that introduce major innovations and make substantial contributions to growth – have been in decline. This column uses US micro data to explore the behaviour of high-growth young firms between 1980 and 2010. A decline in young firm activity in the 1980s and 1990s was dominated by young firms in the retail trade sector. In the post-2000 period, in contrast, a sharp decline in high-growth young businesses in key innovative sectors like high tech suggests there has been a decline in transformational entrepreneurs in this sector.
Jamal Haidar, Takeo Hoshi, 21 October 2015
The Abe administration has outlined a desire for Japan to rank among the top three OECD countries in the World Bank’s Doing Business ranking. This column uses the Doing Business ranking itself to identify potential reforms the country could pursue to improve its position. Several politically viable, non-judicial reforms could quickly and easily move Japan up in the ranking. The approach highlights how the Doing Business rankings can be used to inform policy reform discussions.
Mariacristina De Nardi, 11 July 2015
Wealth inequality is back in the spotlight, but its determinants and the saving behaviour generating it are less clear. This column discusses the mechanisms in dynamic quantitative macro models that give rise to wealth inequality. Different mechanisms give rise to similar observed wealth concentrations, but have very different policy implications. A combination of better empirical analysis and richer models is needed to guide policy.
Kirill Shakhnov, 17 January 2015
The rapid growth of the US financial sector has driven policy debate on whether it is socially desirable. This column examines the trade-off between finance and entrepreneurship, and links the growth of finance to rising wealth inequality. Although financial intermediation helps allocate capital efficiently, people choosing a career in finance do not internalise the negative effect on the pool of talented entrepreneurs. This mechanism can explain the simultaneous growth of wealth inequality and finance in the US, and why more unequal countries have larger financial sectors.
The Workshop will bring together researchers interested in studying entrepreneurship. We welcome submissions related to (occupational) choice, entrepreneurial behaviour, incentives to promote entrepreneurship, relevant program evaluations, entrepreneurship & institutions, the management of entrepreneurship and innovation, entrepreneurship & (venture) capital, financing entrepreneurship, entrepreneurship & regions, theory of the firm, etc. We welcome both theoretical and empirical contributions (empirical work based on data of developing and developed countries).
The (draft) papers should be submitted by Saturday 31 January 2015.
Ejaz Ghani, William Kerr, Stephen O'Connell, 02 October 2014
Numerous countries have implemented seat reservations for women in politics over the past decades. Starting in the early 1990s, India’s flagship decentralisation reform instituted one-third seat reservations for women in local governance bodies. This column suggests that this political empowerment increased women’s economic empowerment through at least one channel, i.e. small-scale entrepreneurship. These findings suggest that political empowerment policies for women may additionally have beneficial economic effects in the longer run.
Manuel Adelino, Song Ma, David Robinson, 12 February 2014
There is a strong link between entrepreneurship and growth – young firms were responsible for almost all net job creation in the US economy over the last 30 years. This column presents new research into the responsiveness of firms of different ages to investment opportunities. Firms aged 0–23 months create about twice the total number of new jobs in response to local income shocks than firms that are more than six years old.
Simone Bertoli, Francesca Marchetta, 04 October 2013
Return migrants have major social and economic consequences for their countries of origin. This column uses Egyptian household-level data to analyse the effects of migrants returning from neighbouring Arab countries. Start-up firms by returnees are more likely to survive, and returnee families tend to have more children. These results imply that return migration may not be an unmitigated blessing for Egypt.
Meghana Ayyagari, Thorsten Beck, Mohammad Hoseini, 02 June 2013
Using state-level data from India over the period 1983 to 2005, this paper gauges the effect of financial deepening and outreach on rural poverty. Its findings suggest that financial deepening contributed to poverty alleviation in rural areas by fostering entrepreneurship and inducing geographic-sectoral migration.
Aaron Chatterji, Edward Glaeser, William Kerr, 04 June 2013
Contrary to received wisdom, entrepreneurial clusters in the US – like Silicon Valley – are seen as success stories. But what is the rationale behind these clusters? Do they actually work? This column reviews the evidence and discusses localised policies currently being pursued in the US. In general, our understanding of what works remains limited and economists should more thoroughly pursue researching the effects of entrepreneurial clusters.
Ejaz Ghani, William Kerr, Stephen O'Connell, 22 February 2013
Although its economic development has been impressive, recent events have sparked debate about India’s gender inequality. This column argues that Indian women’s levels of entrepreneurship and participation in the labour force are some of the lowest in the world. India’s economic growth and shared prosperity depends upon successfully utilising both its male and female workforce, and improving this balance is an important step towards sharing the benefits of India’s growth. Economically and socially, gender equality should be a no-brainer for policymakers.
Yves Zenou, Jackline Wahba, 19 August 2012
Are return migrants more likely to become entrepreneurs than non-migrants? This column, using data from Egypt, argues that although migrants lose their social networks while they are overseas, the savings and human capital accumulation that they acquire abroad more than compensate for this loss. This makes return migrants more likely to start businesses.
Ejaz Ghani, William Kerr, Stephen O'Connell, 26 February 2012
Entrepreneurship is often held aloft as the missing ingredient for growth in many economies, particularly developing countries. But for many policymakers, entrepreneurs are a mystery. This column looks at India and asks why entrepreneurs locate where they do.
Luigi Guiso, Aldo Rustichini, 17 January 2011
Why are women so under-represented among entrepreneurs? Are women intrinsically ill-suited to the risk-taking and competition of entrepreneurship? Or is it social norms that impede them? The authors of CEPR DP8204 test these theories and argue that sexist culture keeps even high-ability women from becoming entrepreneurs.
William Kerr, Ramana Nanda, 27 April 2010
How should a government promote entrepreneurship? This column argues that providing support programmes for targeted sectors or companies is akin to “picking winners ex ante”. A far better approach is to encourage competition in the financial sector that facilitates experimentation in the real economy. Governments should forget about picking winners and focus on picking the right system.
Josh Lerner, 12 March 2010
Josh Lerner of Harvard Business School talks to Vox about the policies that governments employ to encourage venture capital and entrepreneurial activity, drawing on the findings in his book, Boulevard of Broken Dreams: Why Public Efforts to Boost Entrepreneurship and Venture Capital Have Failed – and What to Do About It. The interview was recorded in London in January 2010.
Josh Lerner, 12 February 2010
Josh Lerner of Harvard Business School talks to Vox about sovereign wealth funds, which are the focus of a chapter in his new book, Boulevard of Broken Dreams: Why Public Efforts to Boost Entrepreneurship and Venture Capital Have Failed – and What to Do About It. The interview was recorded in London in January 2010.