An Anatomy of Entrepreneurial Pursuits in Relation to Poverty

Entrepreneurship and Regional Development, Forthcoming

41 Pages Posted: 28 May 2019 Last revised: 29 May 2019

See all articles by Douglas J. Cumming

Douglas J. Cumming

Florida Atlantic University

Sofia Johan

Florida Atlantic University - Finance; Tilburg Law and Economics Center (TILEC)

Ikenna S. Uzuegbunam

Ohio University

Date Written: April 1, 2019

Abstract

This study examines the causal relationships between inequality, poverty, and entrepreneurship. We hypothesize that income inequality influences entrepreneurial activity, and entrepreneurial activity alleviates absolute poverty. Findings from a longitudinal analyses of a dataset from all 50 U.S. states over an 18-year period provide robust support for these hypotheses. Furthermore, the results suggest that antipoverty public policy aimed at encouraging work (i.e. Earned income tax credit, EITC) can be detrimental to entrepreneurial activity. These findings underscore the importance of linking public policy efforts aimed at poverty alleviation with those aimed at encouraging additional entrepreneurship.

Keywords: Entrepreneurial activity, income inequality, opportunity, poverty, public policy, development

JEL Classification: I30, L26, L31

Suggested Citation

Cumming, Douglas J. and Johan, Sofia A. and Uzuegbunam, Ikenna S., An Anatomy of Entrepreneurial Pursuits in Relation to Poverty (April 1, 2019). Entrepreneurship and Regional Development, Forthcoming. Available at SSRN: https://ssrn.com/abstract=3380989

Douglas J. Cumming

Florida Atlantic University ( email )

777 Glades Rd
Boca Raton, FL 33431
United States

HOME PAGE: http://booksite.elsevier.com/9780124095373/

Sofia A. Johan

Florida Atlantic University - Finance ( email )

777 Glades Rd
Boca Raton, FL 33431
United States

Tilburg Law and Economics Center (TILEC) ( email )

Warandelaan 2
Tilburg, 5000 LE
Netherlands

Ikenna S. Uzuegbunam (Contact Author)

Ohio University ( email )

Copeland Hall
1 Ohio University
Athens, OH 43147
United States

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