Does Corruption Discourage Entrepreneurship?
Publication | September 2022
In this paper, the authors examine the relationship between corruption and entrepreneurship employing two widely used proxies from the Global Entrepreneurship Monitor and the World Bank Group Entrepreneurship Survey.
Corruption discourages entrepreneurship because it undermines fair competition. This is the premise under which the study was undertaken considering (i) nascent entrepreneurship collected from Global Entrepreneurship Monitor and (ii) entry rate defined as the number of new firms divided by the total number of the previous year’s registered businesses from the World Bank Group Entrepreneurship Survey. Evidence presented in the paper show that entrepreneurial activity tends to be more vibrant in less corrupt countries.