Document Type : Scientific research
Authors
Abstract
According to different economists such as Baumol and Acemoglu, entrepreneurship may manifest itself in a community productively and non-productively. Rewards structure and wealth distributions are effective factors in investment decisions and economic growth. All economies worldwide are suffering from a degree of corruption, which enables rent-seekers to take possession of a part of entrepreneurs’ shares and it could be a sign of violation of property rights. This research presents a theoretical model for the relationship of investment decisions with rent-seekers probability and bribe rate; it is shown that economies may be placed in a multiple equilibria state with low and high rentier rates. The study also found that both the entrepreneurial investment level and income, and rent-seekers income (share), are negatively correlated with the likelihood of an entrepreneur encountering a rent-seeker. In fact, rent-seeking as a symbol of violation of property rights not only decreases the investment level, but also has a negative effect on the rent-seekers payoff. An extended model shows that considering the open economy and the possibility of immigration, it becomes clear that high bribe rates increase the immigration motivation, and greater difference in the rentier rates of the two countries raises the immigration likelihood.
Keywords
Acemoglu, D. (1995). Reward structures and the allocation of talent. European Economic Review, 39(1), 17-33.
Acs, Z. (2006). How is entrepreneurship good for economic growth? Innovations: technology, governance, globalization, 1(1), 97-107.
Acs, Z. and Audretsch, D. (1990), “Entrepreneurship as social construction: a multilevel evolutionary approach”, Innovation and Small Firms, MIT Press, Cambridge, MA.
Acs, Z. J., & Armington, C. (2006). Entrepreneurship, Geography, and American Economic Growth. Cambridge Books.
Acs, Z. J., & Virgill, N. (2010). Entrepreneurship in developing countries. In Handbook of entrepreneurship research (pp. 485-515). Springer, New York, NY.
Aldrich, H. and Martinez, M. (2010), “Entrepreneurship as social construction: a multi-level evolutionary approach”, in Acs, Z.J. and Audretsch, D.B. (Eds), Handbook of Entrepreneurship Research, Springer, New York, NY, pp. 359-99.
Alvarez, S.A., Barney, J.B. and Young, S.L. (2010), “Debates in entrepreneurship: opportunity formation and implications for the field of entrepreneurship”, in Acs, Z.J. and Audretsch, D.B. (Eds), Handbook of Entrepreneurship Research, Springer, New York, NY, pp. 23-46.
Ardagna, S., & Lusardi, A. (2010). Explaining International Differences in Entrepreneurship: The Role of Individual Characteristics and Regulatory Constraints. In International Differences in Entrepreneurship (pp. 17-62). University of Chicago Press.
Audretsch, D. B. (2012) "Entrepreneurship research", Management Decision, Vol. 50 Issue: 5, pp.755-764,
Audretsch, D. B. (2007). Entrepreneurship capital and economic growth. Oxford Review of Economic Policy, 23(1), 63-78.
Audretsch, D.B. and Keilbach, M. (2007), “The theory of knowledge spillover entrepreneurship”, Journal of Management Studies, Vol. 44 No. 7, pp. 1242-54.
Auriol, E., Straub, S., and Flochel, T. (2016), ‘Public Procurement and Rent-seeking: The Case of Paraguay’, World Development, 77, 395–407.
Baumol, W. J. (1990), ‘Entrepreneurship: Productive, Unproductive, and Destructive’, Journal of Political Economy, 98, 893–921.
Baumol, William J. “Entrepreneurship in Economic Theory.” The American Economic Review, vol. 58, no. 2, 1968, pp. 64–71.
Birch, D. (1981), “Who creates jobs?”, The Public Interest, Vol. 65, pp. 3-14.
Boudreaux, C. J., Nikolaev, B. N., & Holcombe, R. G. (2018). Corruption and destructive entrepreneurship. Small Business Economics, 51(1), 181-202.
Bowen, Donald D., and Robert D. Hisrich. "The female entrepreneur: A career development perspective." Academy of management review 11.2 (1986): 393-407.
Decker, R., Haltiwanger, J., Jarmin, R., & Miranda, J. (2014). The role of entrepreneurship in US job creation and economic dynamism. Journal of Economic Perspectives, 28(3), 3-24.
Desai, S., Acs, Z. J., & Weitzel, U. (2013). A model of destructive entrepreneurship: Insight for conflict and postconflict recovery. Journal of Conflict Resolution, 57(1), 20-40.
Faria, J. R., Cuestas, J. C., & Gil-Alana, L. A. (2009). Unemployment and entrepreneurship: A cyclical relation?. Economics Letters, 105(3), 318-320.
Hébert, R. F., & Link, A. N. (1989). In search of the meaning of entrepreneurship. Small business economics, 1(1), 39-49.
Hechavarría, D. M., Matthews, C. H., & Reynolds, P. D. (2016). Does start-up financing influence start-up speed? Evidence from the panel study of entrepreneurial dynamics. Small Business Economics, 46(1), 137-167.
Iyer, R., & Schoar, A. (2010). Are there cultural determinants of entrepreneurship? In International differences in entrepreneurship (pp. 209-240). University of Chicago Press.
Kuznets, S. (1940), ‘Schumpeter’s Business Cycles’, American Economic Review, 30, 257–71.
Leitão, J., Lasch, F., & Thurik, R. (2011). Globalisation, entrepreneurship and regional environment. International Journal of Entrepreneurship and Small Business, 12(2), 129-138.
Lucas, R. E. (1978), ‘On the Size Distribution of Business Firms’, Bell Journal of Economics, 9, 508–23.
Murphy, K. M., Shleifer, A., and Vishny, R. (1991), ‘The Allocation of Talent: Implications for Growth’, Quarterly Journal of Economics, 106, 503–30.
Murphy, K. M., Shleifer, A., and Vishny, R. (1993), ‘Why is Rent-seeking so Costly to Growth?’, American Economic Review Papers and Proceedings, 83, 409–14.
Parker, Simon C. The economics of entrepreneurship. Cambridge University Press, 2009
Sarasvanthy, S., Nicholas, D., Ramakrishna, V. and Venkataraman, S. (2003), “Three views of entrepreneurial opportunity”, in Acs, Z.J. and Audretsch, D.B. (Eds), Handbook of Entrepreneurship Research, Springer, New York, NY, pp. 77-98.
Schumpeter, J. A. (1934), The Theory of Economic Development, Cambridge MA, Harvard University Press.
Schumpeter, J. A. (1939), Business Cycles, New York, McGraw-Hill.
Schumpeter, J. A. (1947), ‘The Creative Response in Economic History’, Journal of Economic History, 7, 149–59.
Thurik, A. R., Carree, M. A., Van Stel, A., & Audretsch, D. B. (2008). Does self-employment reduce unemployment?. Journal of Business Venturing, 23(6), 673-686.
Van Stel, A., Carree, M., & Thurik, R. (2005). The effect of entrepreneurial activity on national economic growth. Small business economics, 24(3), 311-321.
Vivarelli, M. (2013). Is entrepreneurship necessarily good? Microeconomic evidence from developed and developing countries. Industrial and corporate change, 22(6), 1453-1495.
Wennekers, R., Uhlaner, S., & Thurik, L. M. (2006). Entrepreneurship and economic performance: a macro perspective. Modern Perspectives on Entrepreneurship: The Latest Advances in Entrepreneurship from some of the Leading Minds in the Field,” Dublin: Senate Hall Academic Publishing, 47-68.
Wennekers, S., & Thurik, R. (1999). Linking entrepreneurship and economic growth. Small business economics, 13(1), 27-56.
Wennekers, S., Van Stel, A., Carree, M., & Thurik, R. (2010). The relationship between entrepreneurship and economic development: Is it U-shaped?. Foundations and Trends® in Entrepreneurship, 6(3), 167-237.
)
Send comment about this article