Entrepreneurship,income distribution and economic growth

Traditionally different factors and variables have been considered in the economic growth models. Following Solow’s model, economists considered physical capital and technology during 1950s–1980s. With the introduction of endogenous growth models, new forms of capital were introduced in the production function; human capital, public capital and more recently social capital. However, the consideration of qualitative variables is necessary to improve the economic growth analysis. The improvement of statistical information has favored their introduction in the economic growth models. Recently, “entrepreneurship” concept has been considered in this type of analysis. Entrepreneurship considers the capacity and ability to create new business and production activity. It is an activity not an occupation. Some authors like Schumpeter have included it in their models and they have analysed its effects on economic growth. But it is also necessary to include the role of social climate, that in a schumpterian way it could be represented by income distribution. The main objective of the paper is to analyze the relationship between entrepreneurship, income distribution and economic growth following the ideas developed by Schumpeter and we will contrast them from a empirical analysis using the GEM (Global Entrepreneurship Monitor) data.     

Entrepreneurship and economic growth: Evidence from emerging and developed countries

This paper presents an extension to the economic growth model developed by Wong, Ho, and Autio (2005 Autio, E. 2005. 2005 report on high-expectation entrepreneurship, Toronto: GEM Consortium.  [Google Scholar]), to reflect differences in the economic effects of opportunity and necessity-based entrepreneurship in both emerging and developed countries. Data from 44 countries for the years 2004 and 2005, as collected by Global Entrepreneurship Monitor (GEM) research and Global Competitiveness Report (GCR) research, are used to identify predictors of GDP growth for emerging and developed nations. The GEM data are used to determine the effect of different types of entrepreneurship on GDP growth. The GCR data operationalize additional control variables suggested by three economic growth theories: new economic geography, endogenous growth theory and national systems of innovation. This contribution to the literature suggests that, in developed countries, a significant portion of economic growth rates can be attributed to high-expectation entrepreneurs exploiting national investments in knowledge creation and regulatory freedom. However, in emerging countries this effect is absent. It is hypothesized that a threshold exists for entrepreneurs to gain access to the formal economy, below which entrepreneurial contributions act through informal mechanisms.     

Entrepreneurship,innovation and competitiveness: A public institution love triangle

Diverse and different research studies have approached the impact of the quality of public institutions on entrepreneurship, innovation and competitiveness. However, this relationship has not hitherto been subject to simultaneous study but rather only separately. In turn, our research thus holds the objective of simultaneously evaluating the impact of the quality of public institutions on entrepreneurship, innovation and competitiveness based on data aggregated at the OECD member state level. We therefore seek to demonstrate how the higher the perceptions of public institution quality held by individuals, the higher the indices of entrepreneurship, innovation and competitiveness. To this end, we deploy data collected from various sources, specifically the United Nations (UN), the World Bank (WB), the Organisation for Economic Cooperation and Development (OECD), World Intellectual Property Organization (WIPO), Global Entrepreneurship Monitor (GEM), World Economic Forum (WEF), International Bank for Reconstruction and Development (IBRD) and Freedom House (FH), for the years between 2006 and 2018 (13 years). For the analysis of this data, we apply an econometric methodology based on multiple regression models for unbalanced panel data. We may thus report that the higher the perception of quality of public institutions, the greater the level of the variables applied for entrepreneurship, innovation and competitiveness. We believe our empirical results contain important implications whether for researchers, politicians and decision-makers involved in drafting public policies.     

Entrepreneurship,innovation and regional performance: application for the Spanish regions

Abstract

The aim of this study is to test the importance of entrepreneurship or new business formation for explaining differences in economic performance in the Spanish regions, together with the role played by the endowments of innovation capital and the socio-economic capabilities of every region. The results show that the effect of new business formation on economic performance varies considerably between regions, and the type of start-up is highly important for the results obtained: entrepreneur endowments of high technology intensive sectors and medium technology intensive sectors, but not those of low technology intensive sectors, have a positive effect on regional performance. Also, the size of the start-ups is important for explaining regional development.     

Federalism,taxation, and economic growth

We present a model of endogenous growth where government provides a productive public good financed by income and capital taxes. In equilibrium, a decentralized government chooses tax policy to maximize economic growth, while a centralized government does not do so. Furthermore, these conclusions hold regardless of whether governments are beholden to a median voter or are rent-maximizing Leviathans. However, a decentralized government will under-provide public goods which benefit citizens directly, while a central government beholden to the median voter will optimally invest in such public goods.     

Entrepreneurship and economic development: the EMPRETEC showcase

The hypothesis that entrepreneurship is linked to economic growth finds it’s most immediate foundation in simple intuition, common sense and pure economic observation: activities to convert ideas into economic opportunities lie at the very heart of entrepreneurship. Entrepreneurship is a source of innovation and change, and as such spurs improvements in productivity and economic competitiveness. The entrepreneur has been a fundamental agent in most production, distribution and growth theories. The role of entrepreneurship as the driving force of economic growth found its most explicit foundation. Empretec was established in 1988 to promote entrepreneurship in developing countries. Empretec’s programs have been initiated in 27 countries plus additional centers in Brazil, assisting more than 80, entrepreneurs through local driven business support centers. The information collected for this paper was secondary data rather than conducting survey. Therefore, one objectives of this paper is to examine the exact nature of entrepreneurship and its role in economic theory.     

The information revolution,innovation diffusion and economic growth: an examination of causal links in European countries

Quality & Quantity - Over the last 5 decades, the economic landscape in Europe has been transformed rapidly due to innovation, digitisation of the economy, and emergence of new sources of...     

Population,pensions, and endogenous economic growth

We study the effect of a declining labor force on the incentives to engage in labor-saving technical change and ask how this effect is influenced by institutional characteristics of the pension scheme. When labor is scarcer it becomes more expensive and innovation investments that increase labor productivity are more profitable. We incorporate this channel in a new dynamic general equilibrium model with endogenous economic growth and heterogeneous overlapping generations. We calibrate the model for the US economy and obtain the following results. First, the effect of a decline in population growth on labor productivity growth is positive and quantitatively significant. In our benchmark, it is predicted to increase from an average annual growth rate of 1.74% over 1990–2000 to 2.41% in 2100. Second, institutional characteristics of the pension system matter both for the growth performance and for individual welfare. Third, the assessment of pension reform proposals may depend on whether economic growth is endogenous or exogenous.     

Institutions,social capability,and economic growth

I discuss correlations between the historical growth of social capabilities and patterns of economic growth across world regions since the industrial revolution and especially in recent decades. Based on this analysis, I argue that the apparent relationship between institutions and economic growth results in part because better institutional performance goes hand in hand with more advanced social capabilities.     

Education,economic growth,and brain drain

This paper constructs a two-sector overlapping-generations model of endogenous growth to study the effects of brain drain on growth, education and income distribution. It is shown that brain drain reduces the economic growth rate and generally hurts the non-emigrants through the static income-distributional effects and the dynamic damage on economic growth and human capital accumulation. If the initial rate of human capital accumulation is relatively low, brain drain could deteriorate both the sum of discounted income and lifetime discounted utility of a representative non-emigrant. The government can choose to spend more on education to lessen the detrimental growth effects of brain drain.     

Complementarity,fiscal decentralization and economic growth

Theories of the voluntary provision of public goods and development economics have clarified that complementarity in the production process is a crucial ingredient to understanding how alternative economic environments affect economic performance. This paper examines how the structures of intra- and inter-regional complementarity affect the relationship between economic growth and fiscal decentralization. We provide a theory that describes how fiscal decentralization affects economic growth under various structures of regional complementarity. Our empirical analysis, based on a panel data set of the fifty states of the United States over the period of 1992–1997, supports our theoretical specification of the production function. Also, we observe a hump-shaped relationship between fiscal decentralization and economic growth that is consistent with our theoretical result. Our analysis also shows that the optimal degree of fiscal decentralization conducive to economic growth is higher than the average of the data in some cases, and hence further decentralization is recommended for economic growth. The previous version of the paper was presented at the 59th Congress of the International Institute of Public Finance (University of Economics in Prague, Prague), the 2003 Fall Meeting of the Japanese Economic Association (Meiji University, Tokyo), the 60th Annual Meeting of the Japanese Institute of Public Finance (Kansai University, Osaka), and in seminars at Yokohama National University and the University of California, Irvine. The authors acknowledge the comments and discussions by people including Timothy Goodspeed, Kiyoshi Mitsui, Motohiro Sato, Etsuro Shioji, Tsunao Okumura, and Craig Parsons. We are also grateful for the comments by the Editor (Amihai Glazer) and two anonymous referees. The usual disclaimer applies. Nishimura acknowledges the financial support from JSPS (Japan Society for the Promotion of Science) Postdoctoral Fellowships for Research Abroad.     

Capital utilization, economic growth and convergence

Optimal decisions by economic agents regarding the utilization of capital lead to empirically plausible speeds of convergence in one-sector models of economic growth. The relationship between depreciation and capital utilization plays a crucial role in slowing down convergence to the steady state. Cross-country differences in the extent to which the capital utilization decision is internalized along the transition path may lead to differences in convergence rates, even for countries with similar initial and terminal conditions. Finally, by assuming a constant depreciation rate and full capital utilization, standard growth models may be overstating the magnitude of the steady-state equilibrium.     

Natural inequality,production and economic growth

This paper explains why the effect of income inequality on productivity and growth is ambiguous. When income distribution exhibits inequality levels that are compatible with accepted criteria, productivity and growth ensue. When the divergence from an acceptable level of inequality occurs, then under certain conditions, we may expect lower (higher) production levels and lower (higher) levels of economic growth.     

Endogenous lifetime,accidental bequests and economic growth

This paper introduces the concept of unintentional bequests in a closed economy à la Chakraborty (J Econ Theory 116:119–137, 2004) with overlapping generations. We show that scarce public investments in health can lead to poverty traps depending on the relative size of the output elasticity of capital. More importantly, the existence of unintentional bequests, rather than a market for annuities, means that health tax rates play a prominent role in determining the stability of the long-term equilibrium in rich economies. In fact, Neimark–Sacker bifurcations and endogenous fluctuations occur depending on the size of the public health system.     

Endogenous fertility, multiple growth paths, and economic convergence

"This paper extends the Cass-Koopmans optimal growth model to allow for endogenous fertility choice. It is shown that if agents choose their fertility rate, then the net rate of return on capital (marginal product of capital minus the population growth rate) may not be monotonically decreasing in capital. In this case, multiple steady states and growth paths may emerge, which can explain the persistent differentials in income between poor and rich countries, as well as the existence of development miracles and disasters. The paper provides also empirical evidence which supports the existence of multiple convergence groups and is consistent with the theoretical model."     

Corruption, economic growth, and income inequality in Africa

This paper uses panel data from African countries and a dynamic panel estimator to investigate the effects of corruption on economic growth and income distribution. I find that corruption decreases economic growth directly and indirectly through decreased investment in physical capital. A unit increase in corruption reduces the growth rates of GDP and per capita income by between 0.75 and 0.9 percentage points and between 0.39 and 0.41 percentage points per year respectively. The results also indicate that increased corruption is positively correlated with income inequality. The combined effects of decreased income growth and increased inequality suggests that corruption hurts the poor more than the rich in African countries. Received: March 19, 2001 / Accepted: December 14, 2001 RID="*" ID="*" An earlier version of this paper was presented at the first AmFiTan International Conference on Development Ethics in February 2000, Dar er Salaam, Tanzania. I thank two anonymous referees of this Journal for helpful suggestions. I am, however, solely responsible for any remaining errors.     

Debt,financial sector development and Asian economic growth

This special issue of Economic Systems includes four papers that broadly relate to the relationship between financial sector development and debt in the Asia-Pacific region. The motivation underlying the choice of the Asia-Pacific region in this special issue is due to the increasing importance that this region will play in powering future world economic growth. In addition, in recent times the focus has been upon the importance of equity and financial sector development, as opposed to debt. The world currently faces many economic imbalances and increasing importance is being placed in the Asia-Pacific upon the breadth and depth of bond markets in helping to restore equilibrium in the world economy. Debt influences corporate funding opportunities and may assist countries in achieving sustainable economic growth. These four papers contribute to our knowledge on the relationship between debt and financial sector development.     

Demographic transition,education and economic growth in Tunisia

This paper provides empirical evidence supporting the interaction between fertility, education and economic growth through the underlying mechanism behind that correlation in accordance with Becker's theory. In consistency with the theory, the key explanatory variables in Tunisia's fertility model are real GDP per capita, infant mortality, contraceptive use ratio, and education. As opposed to most empirical works, the present study takes into consideration three educational levels, i.e., primary, secondary and higher. Also unlike most empirical research, this study attempts to analyse the impact of fertility transition on education and economic growth. To deal with too little or incomplete data, time series data for Tunisia are computed over 45 years. A multivariate cointegration analysis is carried out and shows that a long-term triangular relationship exists. A short dynamic run analysis based on the vector correction error model displays results in coherence with and close to those of the long term. Among our key results, education is found to trigger fertility transition both in the short and long run. In addition, education has relatively fostered economic growth but hardly boosted it through its dynamic interaction with fertility. Furthermore, the variance decomposition and the impulse function show that the fertility transition has produced a feedback effect on both education and economic growth.     

自主创新：中国经济新誓言

中国经济凭借着自身改革所释放出来的巨大潜能刷新了一个又一个的历史记录,但却强烈地遭遇到结构趋同、产能过剩、能源短缺以及对外贸易摩擦等多元力量的掣肘。打通经济增长的未来脉络已经客观地落在了自主创新的战略命题之上。