Abstract
This study examines the causal relationships between inequality, poverty, and entrepreneurship. We hypothesize that income inequality influences entrepreneurial activity, and entrepreneurial activity alleviates absolute poverty. Findings from a longitudinal analyses of a dataset from all 50 U.S. states over an 18-year period provide robust support for these hypotheses. Furthermore,
the results suggest that antipoverty public policy aimed at encouraging work (i.e. Earned income tax credit, EITC) can be detrimental to entrepreneurial activity. These findings underscore the importance of linking public policy efforts aimed at poverty alleviation with those aimed at encouraging additional entrepreneurship.
the results suggest that antipoverty public policy aimed at encouraging work (i.e. Earned income tax credit, EITC) can be detrimental to entrepreneurial activity. These findings underscore the importance of linking public policy efforts aimed at poverty alleviation with those aimed at encouraging additional entrepreneurship.
Original language | English |
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Pages (from-to) | 21-40 |
Number of pages | 20 |
Journal | Entrepreneurship and Regional Development |
Volume | 32 |
Issue number | 1-2 |
Early online date | 15 Jul 2019 |
DOIs | |
Publication status | Published - Jan 2020 |
Bibliographical note
All authors contributed equally to this research. We owe thanks to the Editors Steven Si, David Ahlstrom, John Cullen, and Jiang Wei, as well as three anonymous reviewers, for very helpful comments and suggestions. Also, we owe thanks to the seminar participants at the Academy of Management, British Academy of Management, Strategic Management Society, and the Law and Entrepreneurship Retreat at the University of Alabama. Douglas Cumming and Sofia Johan owe thanks to the Social Sciences and Humanities Research Council of Canada for Financial Support. The authors also thank the University of Kentucky Poverty Research Center for access to some of the data used in this research.Keywords
- Entrepreneurial activity
- development
- income inequality
- opportunity
- poverty
- public policy
- MICROFINANCE
- SUCCESS
- CHINA
- FIRMS
- INNOVATION
- RESEARCH GO
- POLICY
- YOUNG
- INCOME
- GROWTH