Entrepreneurship, Resource Rents and Institutions

Mollick Andre and Sui Lu ()
Additional contact information
Mollick Andre: The University of Texas Rio Grande Valley, Edinburg, TX, USA
Sui Lu: Shandong Technology and Business University, Yantai, 264005, China

Entrepreneurship Research Journal, 2024, vol. 14, issue 4, 1669-1699

Abstract: The resource curse hypothesis supposes that rents generated by resource booms create opportunities for rent-seeking activities, which weaken innovation and economic development due to the potentially adverse effects in competitive markets. The quality of institutions is an important channel to transform society from a rent-seeking economy to an entrepreneurial economy. We address in this paper these channels by examining necessity, opportunity, productive and innovative measures of entrepreneurship. Using annual data from 2002 to 2017, we estimate the relationship between entrepreneurship and natural resource rents for 60 countries. Allowing for measures of institutions (corruption, government policies, and cultural and social norms) and real GDP growth, we find that natural resource rents have negative effects on productive and innovative entrepreneurship, especially in high-income countries. In threshold dynamic panels, entrepreneurial activities grow with higher levels of corruption (weaker institutions), with an interpretation provided based on the higher corruption in developing economies.

Keywords: corruption; entrepreneurship; growth; institutions; resource rents (search for similar items in EconPapers)
Date: 2024
References: Add references at CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1515/erj-2023-0028 (text/html)
For access to full text, subscription to the journal or payment for the individual article is required.

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:bpj:erjour:v:14:y:2024:i:4:p:1669-1699:n:1013

Ordering information: This journal article can be ordered from
https://www.degruyter.com/journal/key/erj/html

DOI: 10.1515/erj-2023-0028

Access Statistics for this article

Entrepreneurship Research Journal is currently edited by Chandra S. Mishra and Ramona K. Zachary

More articles in Entrepreneurship Research Journal from De Gruyter
Bibliographic data for series maintained by Peter Golla ().