Regulation, entrepreneurship, and dynamism

Dustin Chambers (), Patrick A. McLaughlin and Oliver Sherouse
Additional contact information
Dustin Chambers: Salisbury University
Patrick A. McLaughlin: Mercatus Center at George Mason University

Empirical Economics, 2023, vol. 64, issue 5, No 17, 2449-2466

Abstract: Abstract Most researchers observe a negative association between regulatory accumulation and traditional measures of entrepreneurship (i.e., firm startups and job formation). However, when measuring business activity with metrics common to the dynamism literature, researchers fail to find a significant association between regulation and startup activity. After ruling out differences in unit of measure, industry aggregation, and regulation measurement, we demonstrate that differences in entrepreneurship and dynamism measurement are potentially responsible for the conflicting results. However, we do find empirical evidence that the relationship between regulations and job creation rates varies across industries. In industries with high job creation rates in the prior period, increased regulations are associated with lower job creation rates in the current period. However, the opposite is true in industries with low job creation rates in the prior period (i.e., increased regulations are associated with higher job creation rates in the current period). Depending upon the vintage of the regulation dataset (i.e., RegData 2.0), a similar pattern holds for the startup rate.

Keywords: Regulation; Entrepreneurship; Dynamism; Employment; Firm size (search for similar items in EconPapers)
JEL-codes: C23 K23 L26 L51 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1007/s00181-022-02321-6 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:empeco:v:64:y:2023:i:5:d:10.1007_s00181-022-02321-6

Ordering information: This journal article can be ordered from
http://www.springer. ... rics/journal/181/PS2

DOI: 10.1007/s00181-022-02321-6

Access Statistics for this article

Empirical Economics is currently edited by Robert M. Kunst, Arthur H.O. van Soest, Bertrand Candelon, Subal C. Kumbhakar and Joakim Westerlund

More articles in Empirical Economics from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().