Effects of FDI on entrepreneurship: Evidence from Right-to-Work and non-Right-to-Work states

Ozkan Eren, Masayuki Onda and Bulent Unel ()

Labour Economics, 2019, vol. 58, issue C, 98-109

Abstract: This paper investigates the impact of Foreign Direct Investment (FDI) on entrepre-neurial activity at the individual-owner level in U.S. states between 1996 and 2008. Our results indicate that FDI has no effect on entrepreneurship in pro-business states identified by the existence of Right-to-Work (RTW) laws. In non-RTW states, however, we find that an increase in FDI decreases the average monthly rate of business creation and destruction. Specifically, a 10% increase in FDI decreases the average monthly rate of business creation and destruction by roughly 4 and 2.5% (relative to the sample mean), respectively.

Keywords: Entrepreneurship; FDI; Right-to-Work laws; Self-employment (search for similar items in EconPapers)
JEL-codes: F21 J24 J38 L26 (search for similar items in EconPapers)
Date: 2019
References: Add references at CitEc
Citations: View citations in EconPapers (9)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:labeco:v:58:y:2019:i:c:p:98-109

DOI: 10.1016/j.labeco.2019.04.008

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