The State of Entrepreneurial Ecosystems of an Economy in Distress

11 Pages Posted: 8 Dec 2015

See all articles by Edgar Soto

Edgar Soto

University of Puerto Rico at Mayaguez

Date Written: December 8, 2015

Abstract

Puerto Rico’s economic development strategy has hit rock-bottom. The once so called 'most open economy of Latin America' (Collins et al., p.1) now faces the insolvency of its 52 state-owned enterprises, the degradation of its triple-tax-exempt municipal bonds to junk grade as well as multi-million losses in the stock market value of the banking industry. To make things worse, the Governor of Puerto Rico recently announced that the $73 billion debt in municipal bonds is unpayable. The causes of this strategic and economic downfall have been brewing for the past six decades: (a) a political system whose economic strategy mostly favored the big enterprise over the local entrepreneur, (b) a pervasive governmental intervention in economic affairs, and (c) a lack of connectivity and continuity between the initiatives and actors responsible for fostering an entrepreneurial climate on the island (Soto-Rodriguez, 2014). As depicted on Table 1, the effectiveness of Puerto Rico’s 60-year old model was short lived. Its benefits reached their peak by the end of the 1970s when the economy reported an average growth of 4%. Thereafter, the economy has never been able to grow above the 3% mark.

Suggested Citation

Soto, Edgar, The State of Entrepreneurial Ecosystems of an Economy in Distress (December 8, 2015). 6th Annual George Washington University (GWU)-International Council for Small Business (ICSB) Global Entrepreneurship Research and Policy Conference. Available at SSRN: https://ssrn.com/abstract=2700802 or http://dx.doi.org/10.2139/ssrn.2700802

Edgar Soto (Contact Author)

University of Puerto Rico at Mayaguez

Mayaguez
Puerto Rico

Register to save articles to
your library

Register

Paper statistics

Downloads
68
rank
328,457
Abstract Views
512
PlumX Metrics
!

Under construction: SSRN citations while be offline until July when we will launch a brand new and improved citations service, check here for more details.

For more information