Economic and Political Institutions and Entry into Formal and Informal Entrepreneurship

Asia-Pacific Journal of Management, Forthcoming

44 Pages Posted: 13 Apr 2014

See all articles by Erkko Autio

Erkko Autio

Imperial College Business School; Tilburg University School of Economics and Management

Kun Fu

Imperial College

Date Written: April 12, 2014

Abstract

We investigated the influence of economic and political institutions on the prevalence rate of formal and informal entrepreneurship across 18 countries in the Asia Pacific region during the period 2001-2010. We found the quality of institutions to exercise a substantial influence on both formal and informal entrepreneurship. One standard deviation increase in the quality of economic and political institutions could double the rates of formal entrepreneurship and halve the rates of informal entrepreneurship. The two types of institutions had a complementary effect on driving entry into formal entrepreneurship, whereas only direct effects were observed for informal entry.

Keywords: informal entrepreneurship, political and economic institutions, poverty, economic development

JEL Classification: M13, O17, P51

Suggested Citation

Autio, Erkko and Fu, Kun, Economic and Political Institutions and Entry into Formal and Informal Entrepreneurship (April 12, 2014). Asia-Pacific Journal of Management, Forthcoming. Available at SSRN: https://ssrn.com/abstract=2424141

Erkko Autio (Contact Author)

Imperial College Business School ( email )

South Kensington Campus
Exhibition Road
London SW7 2AZ, SW7 2AZ
United Kingdom
+447786226452 (Phone)

HOME PAGE: http://www.imperial.ac.uk/people/erkko.autio

Tilburg University School of Economics and Management ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands

Kun Fu

Imperial College ( email )

South Kensington Campus
Exhibition Road
London, Greater London SW7 2AZ
United Kingdom

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