TY  - JOUR
AB  - Purpose– Previous literature has clearly demonstrated the need for sound government policies or “institutions” to promote and support entrepreneurship in a country. The purpose of this paper is to explore the role of one such institution – political stability – in boosting entrepreneurial endeavors. A politically stable nation will have lower risk and transaction/contracting costs, and higher levels of government transparency, predictability, and accountability. Thus, the paper should expect that with greater political stability there should be a greater degree of entrepreneurial activity. Design/methodology/approach– Using dynamic panel estimators (System GMM estimators) and considering multiple proxies of political risk, our results confirm this hypothesis. Such estimators handle challenges associated with panel data efficiently. Findings– The paper's results show that greater political stability for a country does indeed lead to an increased rate of entrepreneurship and wealth creation. Originality/value– Entrepreneurship is critical to the process of economic growth and development. To prosper, countries must unleash the creative talents of their citizens through the decentralized process of formal private sector entrepreneurship. New legal businesses create jobs, opportunities, wealth, and goods and services that make a nation grow. Sadly in many nations, this process is stifled and poverty is the result. While previous research has examined which types of specific policies matter for promoting entrepreneurship, the paper considers the different question of how the stability of political institutions impacts the rate of entrepreneurship.
VL  - 2
IS  - 2
SN  - 2045-2101
DO  - 10.1108/JEPP-03-2012-0018
UR  - https://doi.org/10.1108/JEPP-03-2012-0018
AU  - Dutta Nabamita
AU  - S. Sobel Russell
AU  - Roy Sanjukta
PY  - 2013
Y1  - 2013/01/01
TI  - Entrepreneurship and political risk
T2  - Journal of Entrepreneurship and Public Policy
PB  - Emerald Group Publishing Limited
SP  - 130
EP  - 143
Y2  - 2024/04/25
ER  -