The contribution of business ownership in bringing down unemployment in Japan

The relationship between entrepreneurship, measured by fluctuations in the business ownership rate, and unemployment in Japan is examined for the period 1972-2002. We conclude that, although Japan's unemployment rate has been influenced by different exogenous shocks as compared to other OECD countries, the effects of entrepreneurship on unemployment are not distinct. In the past small firms in Japan benefited from the protective environment of the keiretsu structure. This secure environment no longer exists, and a new market environment conducive to new venture creation and growth is not yet established. We argue that the Japanese government should actively stimulate an entrepreneurial culture

Business Ownership and Sectoral Growth

We investigate the development of business ownership (self-employment) rates over time at the sectoral level and the effect of these rates on sectoral output growth. In an earlier exercise, carree et al. (2002) presented an analysis of the interrelationship between economy-wide business ownership rates and economic development. Their analysis raised an important research question: to what extent do differences in business ownership rates at the economy-wide level reflect differences in the sectoral structures of economies or differences in business ownership rates at the sectoral level? the current article investigates this question making use of a sectoral data base of 21 oecd countries for the period 1970-98. Estimation results suggest that there is, on average, a too low business ownership rate in manufacturing and a too high business ownership rate in services

The role of dissatisfaction and per capita income in explaining self-employment across 15 European countries

This paper deals with explaining the sizable differences in the rate of self-employment (business ownership) across 15 European countries in the period 1978-2000, within a framework of occupational choice, focusing on the influence of dissatisfaction and of per capita income. Using two different measures of dissatisfaction, in addition to the level of economic development and controlling for several other variables, we find that, in addition to a negative and significant impact of per capita income, dissatisfaction at the level of societies has a positive and significant influence on self-employment levels. Both dissatisfaction with life and dissatisfaction with the way democracy works are found to influence self-employment. It is concluded that these are proxies for job dissatisfaction and at the same time represent other negative 'displacements' known to promote self-employment. The findings indirectly point at the potential importance of push factors within the incentive structures of modern economies

Types of entrepreneurship and economic growth

In this paper, we empirically investigate the effect of entrepreneurship on economic growth at the country level. We use data from the Global Entrepreneurship Monitor, which provides comparative data on entrepreneurship from a wide range of countries. An important element of this paper is that we compare the effects of entrepreneurial activity on economic growth in high income, transition and low income countries. This dataset also enables us to make a distinction between the effects of entrepreneurship in general and growth-oriented entrepreneurship in particular. We present empirical tests of the impact of entrepreneurial activity on GDP growth over a four year period for a sample of 36 countries. Our empirical analyses suggest that entrepreneurship does not have an effect on economic growth in low income countries, in contrast to transition and high income countries where especially growth-oriented entrepreneurship seems to contribute strongly to macroeconomic growth

Impeded industrial restructuring: The growth penalty

This paper documents that a process of industrial restructuring has been transforming the developed economies, where large corporations are accounting for less economic activity and small firms are accounting for a greater share of economic activity. Not all countries, however, are experiencing the same shift in their industrial structures. Very little is known about the cost of resisting this restructuring process. The goal of this paper is to identify whether there is a cost, measured in terms of forgone growth, of an impeded restructuring process. The cost is measured by linking growth rates of OECD countries to deviations from the optimal industrial structure. The empirical evidence suggests that countries impeding the restructuring process pay a penalty in terms of forgone growth.Dieses Diskussionspapier dokumentiert einen Strukturwandel, der zur Transformation der Wirtschaften hochentwickelter Länder führt: Großunternehmen verlieren gegenüber den kleineren Firmen relativ an Gewicht. Dieser Strukturwandel erfolgt in den einzelnen Ländern in unterschiedlichem Maße. Sehr wenig ist über die Konsequenzen bekannt, die entstehen, wenn ein Land sich dem Strukturwandel verweigert. Ziel dieses Papiers ist eine Einschätzung möglicher Kosten, die durch Behinderung des Strukturwandels entstehen. Derartige Kosten werden gemessen, indem die Wachstumsrate der OECDLänder den Abweichungen von einer "optimalen" Unternehmensstruktur gegenübergestellt werden. Die empirische Evidenz legt die Vermutung nahe, dass Länder, welche den Strukturwandel behindern, eine "Strafe" in Form von Wachstumseinbußen bezahlen