Journal of Developmental Entrepreneurship

Based on the recognition that enterprises operate at different levels of informality, this paper evaluates the determinants of their degree of informalization. To do so, a 2016 survey of the varying degrees of informalization of 171 entrepreneurs in Ghana is reported. The finding is that only 21% of enterprises were wholly informal and 16% wholly formal. Nearly two-thirds (63%) were neither wholly informal nor wholly formal. Higher levels of informalization are significantly associated with younger entrepreneurs, those with lower levels of educational attainment, lower household incomes and younger enterprises. It is also significantly associated with the wider institutional compliance environment. Higher levels of informality are present among entrepreneurs unaware of the need for registration, who lack vertical trust (i.e., do not believe the state does anything for them, and perceive there to be public sector corruption), view informality as normal (i.e., a normal practice in their family) and view all similar businesses as operating informally (i.e., lack horizontal trust). The paper concludes by discussing the theoretical and policy implications.

We examine the relative efficiency of a unique set of banks, Minority Depository Institutions (MDIs). MDIs are led by minorities and typically serve minority populations. Given Social Economic Status (SES) skews across racial/ethnic groups in the United States, operation within minority communities appear, prima facie, to be relatively expensive and thus inefficient. We examine the return on assets (ROA) and small business lending efficiency of MDIs when compared to what we categorize as “non-MDI” depositories, ceteris paribus. We also examine these institutions for a period that includes a recent environmental shock, the 2008 financial crisis and the post-recessionary period. Using data from the Reports of Condition and Income (call reports) for a substantial set of FDIC-insured banks in the United States, we apply a data envelopment analysis (DEA) to determine how a set of MDIs perform relative to comparable institutions. Recognizing that MDIs are not homogeneous, we also examine relative efficiency across types of MDIs by racial/ethnic grouping. The results indicate that MDIs are not less efficient systematically and that there are differences across MDI types.

We explore whether the generally construed positive effects of intergenerational upward mobility and racial desegregation, under increasing local knowledge stocks, are positively associated with regional entrepreneurial activity. We find the opposite association in a sample of 2,717 US counties. Our results imply that, when county-level knowledge stocks are high, the American Dream (of greater intergenerational upward mobility) and the American Melting Pot (of lower racial segregation) appear, at a minimum, to be not associated with greater entrepreneurial activity. The results are robust to a variety of alternate specifications. For example, when Metropolitan Statistical Area data are used in lieu of county-level data, the results are broadly consistent with those in the main results.

Considerable research has been conducted in the field of entrepreneurship. However, very few studies have explored the impact of entrepreneurship on the life satisfaction/happiness of individuals. Furthermore, they have yet to analyze the extent to which the impact of entrepreneurship is mediated by national cultures. The present study explores the effect of entrepreneurship on the life satisfaction/happiness of individuals and analyzes the extent to which such impact is mediated by ‘national cultures.’ Resorting to fixed effect panel data techniques, this study was conducted using the 2016 World Values Survey dataset, encompassing 90350 individuals from 60 countries over the 2010–2013 period, combined with information provided by the Global Leadership and Organizational Behavior Effectiveness (GLOBE) Framework on cultural measures. We found that being an entrepreneur increases the chances of happiness across the entire set of countries analyzed. Culture does matter in such relation as the impact of entrepreneurship on happiness varies across the sample, being positive for sub-Saharan Africa and Eastern Europe and negative for the Middle East culture cluster. Governments should implement active policies to foster the emergence of new businesses because new ventures enable countries not only to increase their output per capita, but also to achieve economic development by stimulating well-being and happiness. Nevertheless, this study highlights the danger of ‘blind’ recipes/formulas to promote entrepreneurship without considering the ‘entrepreneurship ecosystem’ and, at a more general level, the countries’ culture.

The “Arab Spring” drew attention worldwide to the dire socio-economic conditions in many Arab countries. Efforts to explain, address and resolve these challenges led to a surge in both academic research as well as a plethora of policy recommendations from very different perspectives. By focusing on a crucial area for employment and growth in the Arab region — economic governance and entrepreneurship — the present paper consolidates the vast research and policy recommendations available based on a ‘best evidence’ approach and identifies three priority policy challenges to facilitate entrepreneurship: competition policy, access to finance and entrepreneurial education. We argue that improvement of economic governance tailored to improve these policy areas is a crucial lever for promoting entrepreneurship and creating employment in Arab countries. Highlighting interdependences between these areas, we derive a set of recommendations for each of the identified policy challenges.

Gender inequality remains one of the most pressing socio-economic challenge in South Africa despite the presence of policy initiatives that target women for empowerment. The lack of consensus in the literature of a reliable and consistent measurement instrument of gender equality also makes it difficult to quantify and analyze female empowerment issues. The objective of the study was to estimate a measure for female empowerment, Gender Status Index, for South Africa and then use the index to analyze the relationship between entrepreneurship, economic growth and female empowerment. Using annual data from 1991 to 2017, an ARDL model of female empowerment (GSI), female entrepreneurship (Total female Self-Employment) and economic growth (Real GDP growth) was estimated. The study found that entrepreneurship has a positive impact on economic empowerment but no significant relationship on political and social empowerment. The study recommends more entrepreneurship institutions for female economic empowerment and ongoing policies initiatives that are more direct toward supporting female empowerment.

This paper introduces the maximization of installed capacity instead of profit maximization, as an element that allows for understanding the economic behavior of Informal Social Enterprise (ISE) in the market. The reconsideration of the theoretical framework that explains the competitive behavior of this type of firm, according to the Social Business Type 2 (SB2) Yunus proposal or necessity-driven entrepreneurship, is important because they are recognized as a mechanism to mitigate the poverty effects of recessionary period faults in the distribution of wealth. The results obtained through the contrast between theoretical evidence and the essential assumptions of industrial organization theory suggests that ISEs have a Cournot competition behavior.