 Launching with a parachute: The gig economy and new business formationJohn Barrios, Yael V. Hochberg and Hanyi Yi Journal of Financial Economics, 2022, vol. 144, issue 1, 22-43 Abstract: We utilize the staggered arrival of Uber and Lyft—large sources of on-demand, platform-enabled gig opportunities—in U.S. cities to examine the effect of the arrival of flexible gig work opportunities on new business formation. The introduction of gig opportunities is associated with an increase of ∼5% in the number of new business registrations in the local area, and a correspondingly-sized increase in small business lending to newly registered businesses. Internet searches for entrepreneurship-related keywords increase ∼7%. These effects are strongest in locations where proxies for ex ante economic uncertainty regarding the viability of new businesses are larger. Our findings suggest that the introduction of the gig economy creates fallback opportunities for would-be entrepreneurs that reduce risk and encourage new business formation. Keywords: Gig economy; Entrepreneurship; New business formation; Rideshare; Entrepreneurial risk (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jfinec:v:144:y:2022:i:1:p:22-43 DOI: 10.1016/j.jfineco.2021.12.011 Access Statistics for this article Journal of Financial Economics is currently edited by G. William Schwert More articles in Journal of Financial Economics from Elsevier |
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