TY  - JOUR
AB  - Purpose During recent years, the nexus between unemployment and entrepreneurship has been examined in depth in developed and industrialised economies but rarely in developing economies. The purpose of this paper is to investigate such a relation in the case of 30 Iranian provinces from 2005Q2 to 2017Q4. Using both the autoregressive distributed lag (ARDL) bounds testing and vector error correction method (VECM) Granger causality approaches, the findings show that a unidirectional short-run causal relationship from entrepreneurship to unemployment and vice versa was observed in 13 and 10 per cent of provinces, respectively. The authors also find evidence for unidirectional long-run causality in 77 per cent of provinces from unemployment to entrepreneurship, as well as 10 per cent of provinces from entrepreneurship to unemployment. Finally, the results confirm that in long-run, the “prosperity-pull” effects are considerably stronger than the “recession-push” effects in Iranian provinces.Design/methodology/approach The main target of this paper is to investigate the unemployment-entrepreneurship in the case of 30 Iranian provinces from 2005Q2 to 2017Q4 by using ARDL bounds testing and VECM Granger causality approaches.Findings The results confirm that in long-run, the “prosperity-pull” effects are considerably stronger than the “recession-push” effects in Iranian provinces. This finding reveals that the unemployment rate can be regarded as a critical instrument for hindering entrepreneurial activity by increasing the risk of business bankruptcy and pulling entrepreneurs out of self-employment. All these results must be taken into account in the construction of useful economic policies for the Iranian labour market.Originality/value The economic literature reveals that most empirical studies of the nexus between unemployment and entrepreneurship examined developed and industrialised economies and the analysis of such a relation for developing countries has not been considered by researchers. Thus, to fill this gap, this paper extends the current empirical literature by presenting new empirical evidence for the case of Iran, which has a developing economy.
VL  - 15
IS  - 3
SN  - 1746-8809
DO  - 10.1108/IJOEM-02-2019-0084
UR  - https://doi.org/10.1108/IJOEM-02-2019-0084
AU  - Cheratian Iman
AU  - Golpe Antonio
AU  - Goltabar Saleh
AU  - Iglesias Jesus
PY  - 2019
Y1  - 2019/01/01
TI  - The unemployment-entrepreneurship nexus: new evidence from 30 Iranian provinces
T2  - International Journal of Emerging Markets
PB  - Emerald Publishing Limited
SP  - 469
EP  - 489
Y2  - 2024/05/10
ER  -