Impact of institutions on entrepreneurship: a panel data analysis

Turan Yay (), Gülsün G. Yay () and Tolga Aksoy
Additional contact information
Turan Yay: Yeditepe University
Gülsün G. Yay: Yildiz Technical University

Eurasian Economic Review, 2018, vol. 8, issue 1, No 7, 160 pages

Abstract: Abstract The purpose of this paper is to study the relation between institutions and entrepreneurship from the perspective of institutional economics. In the first section, we discuss the importance, role, and interaction of the institutions and entrepreneurs in the economic and social change/development process. In this context, we point out three roles of institutions: the role of facilitating economic/social exchange, the coordination role of economic actors’ decisions, and the role of the allocation of entrepreneurs between various sectors. In the second part, we investigate the impacts of formal institutions and institutions of governance on formal and informal entrepreneurship using an unbalanced panel data set of 54 countries over the 2004–2012 period. Estimation results reveal that while both formal institutions and governance stimulate formal entrepreneurship, the former is negatively associated with informal entrepreneurship. In addition, we find that financial development increases the positive impact of institutions on formal entrepreneurship. These results also shed light on the link between institutions and entrepreneurship, as suggested by Baumol and de Soto.

Keywords: Formal institutions; Institutions of governance; Formal entrepreneurship; Informal entrepreneurship; Panel data analysis (search for similar items in EconPapers)
JEL-codes: B1 B52 C33 L26 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

Downloads: (external link)
http://link.springer.com/10.1007/s40822-017-0082-0 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:eurase:v:8:y:2018:i:1:d:10.1007_s40822-017-0082-0

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/40822

DOI: 10.1007/s40822-017-0082-0

Access Statistics for this article

Eurasian Economic Review is currently edited by Dorothea Schäfer

More articles in Eurasian Economic Review from Springer, Eurasia Business and Economics Society Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().