Entrepreneurship and the Deregulation of Banking: How Strong is the Evidence?

Wall, Howard J.

doi:10.2139/ssrn.363642

Entrepreneurship and the Deregulation of Banking: How Strong is the Evidence?

Federal Reserve Bank of St. Louis Working Paper No. 2002-032A

15 Pages Posted: 3 Apr 2003

See all articles by Howard J. Wall

Howard J. Wall

Lindenwood University - Center for Economics and the Environment

Date Written: December 2002

Abstract

This paper demonstrates that recent results suggesting a positive relationship between banking deregulation and entrepreneurship are very sensitive to estimation assumptions. When heteroskedasticity and autocorrelation are corrected for, branching deregulation is shown to have no effect and the estimated effect of interstate banking deregulation is reduced by nearly two thirds. When the effects of deregulation are allowed to differ across regions, deregulation of either type is negatively associated with entrepreneurship in some regions, and positively associated in others.

Keywords: Entrepreneurship, banking deregulation

JEL Classification: G28, R12

Suggested Citation: Suggested Citation

Wall, Howard J., Entrepreneurship and the Deregulation of Banking: How Strong is the Evidence? (December 2002). Federal Reserve Bank of St. Louis Working Paper No. 2002-032A, Available at SSRN: https://ssrn.com/abstract=363642 or http://dx.doi.org/10.2139/ssrn.363642