The Intersection of the Fields of Entrepreneurship and Development Economics: A Review Towards a New View

26 Pages Posted: 13 Nov 2017

See all articles by Jolanda Hessels

Jolanda Hessels

Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE)

Wim Naudé

RWTH Aachen University; IZA Institute of Labor Economics; Maastricht School of Management

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Policy makers find it difficult to promote economic development through entrepreneurship and SMEs. In this paper we argue that this is because the positive impact of entrepreneurship is overestimated and its negative impact underestimated. It is moreover also because there is no unified scientific approach towards the role of entrepreneurship in economic development. The scholarly fields that have been interested in this, entrepreneurship economics and development economics, have been elaborated in isolation and only recently started to intersect. This growing intersection is however fragmented, ad hoc, not based on a unifying theoretical approach and suffering from lack of proper measurement. Better policy making will hence benefit from the extension and deepening of the intersection of these fields. We contribute in this regard by providing a conceptual basis for the eventual elaboration of such a unified theoretical approach. We do so by providing an up-to-date review of the intersection of the two scholarly fields, by noting the progress and gaps, by delineating the externalities associated with entrepreneurship in development, and by proposing a new synthesis definition of entrepreneurship.

Keywords: entrepreneurship, development, growth, occupational choice

JEL Classification: F23, L26, L25, O38, O57

Suggested Citation

Hessels, Jolanda and Naudé, Wim, The Intersection of the Fields of Entrepreneurship and Development Economics: A Review Towards a New View. IZA Discussion Paper No. 11103, Available at SSRN:

Jolanda Hessels (Contact Author)

Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE) ( email )

P.O. Box 1738
3000 DR Rotterdam, NL 3062 PA

Wim Naudé

RWTH Aachen University ( email )

Templergraben 55
52056 Aachen, 52056

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072

Maastricht School of Management ( email )

Endepolsdomein 150
Maastricht, Limburg 6201 BE

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