Effects of FDI on Entrepreneurial Activity: Evidence from Right-to-Work and Non-Right-to-Work States

Ozkan Eren, Masayuki Onda and Bulent Unel (bunel@lsu.edu)

Departmental Working Papers from Department of Economics, Louisiana State University

Abstract: This paper investigates the impact of Foreign Direct Investment (FDI) on entrepreneurial activity at the individual-owner level in U.S. states over 1996- 2008. Our results indicate that FDI has no effect on entrepreneurial activity in Right-to-Work (RTW) states. 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-percent increase in FDI decreases the average monthly rate of business creation and destruction by roughly 4 and 2.5 percent (relative to sample mean), respectively.

Date: 2016-04
New Economics Papers: this item is included in nep-cse, nep-ent, nep-ino, nep-int, nep-pr~ and nep-sbm
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Persistent link: https://EconPapers.repec.org/RePEc:lsu:lsuwpp:2016-04

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