Volume 31, Issue 60 (2024)
J Tax Res 2024, 31(60): 101-131 |
Back to browse issues page
Download citation:
BibTeX | RIS | EndNote | Medlars | ProCite | Reference Manager | RefWorks
Send citation to:
BibTeX | RIS | EndNote | Medlars | ProCite | Reference Manager | RefWorks
Send citation to:
Solhkhah N, Panahi H, Mohammadzadeh P, Behboudi D. Investigating the impact of tax policies, corruption and government size on necessity-oriented and opportunity-oriented entrepreneurship. J Tax Res 2024; 31 (60) :101-131
URL: http://taxjournal.ir/article-1-2346-en.html
URL: http://taxjournal.ir/article-1-2346-en.html
1- , nasrin.solhkhah@gmail.com
Abstract: (1150 Views)
Entrepreneurship is interpreted as one of the axes of endogenous development, creating sustainable employment and strengthening economic foundations. Many institutional and economic factors influence the level and quality of entrepreneurship, the most important of which are the duties of the government and its support policies. Considering the importance of the subject and the investigation of the effectiveness of entrepreneurship from environmental variables, the current research is focused on investigating the effect of government performance and especially the effect of tax policies, government size and corruption on types of entrepreneurship (opportunity-oriented and necessity-oriented). In this research, using panel data estimation method with incomplete data, the effect of variables such as tax rate, corruption index and a wide range of government expenses on the development of entrepreneurship at two levels of necessity and opportunity-based has been tested. In this regard, the information of 33 countries was used between 2010 and 2018.
The results show that increasing taxes in selected countries limits opportunity-oriented and necessity-oriented entrepreneurship. Government spending in the public sector has a positive effect on the growth of opportunity-based entrepreneurship. Public corruption has an adverse effect on opportunity-oriented entrepreneurship, while positive and significant effects on necessity-oriented entrepreneurship have been calculated. Also, indicators of the national per capita income level, human capital, credit amount to the private sector, business density, unemployment rate and labor force participation rate are other factors affecting the level and quality of entrepreneurship.
The results show that increasing taxes in selected countries limits opportunity-oriented and necessity-oriented entrepreneurship. Government spending in the public sector has a positive effect on the growth of opportunity-based entrepreneurship. Public corruption has an adverse effect on opportunity-oriented entrepreneurship, while positive and significant effects on necessity-oriented entrepreneurship have been calculated. Also, indicators of the national per capita income level, human capital, credit amount to the private sector, business density, unemployment rate and labor force participation rate are other factors affecting the level and quality of entrepreneurship.
Keywords: entrepreneurship, tax, corruption, necessity-oriented entrepreneurship, poverty-oriented entrepreneurship
Type of Study: Research |
Subject:
Management
Received: 2024/02/20 | Accepted: 2024/02/29 | Published: 2024/04/20
Received: 2024/02/20 | Accepted: 2024/02/29 | Published: 2024/04/20
References
1. Aidis, R. Estrin, S. & Mickiewicz, T. M. (2012). Size matters: Entrepreneurial entry and government. Small Business Economics, 39(1), 119-139. [DOI:10.1007/s11187-010-9299-y]
2. Amorós, J. E. Ciravegna, L. Mandakovic, V. & Stenholm, P. (2019). Necessity or opportunity? The effects of state fragility and economic development on entrepreneurial efforts. Entrepreneurship Theory and Practice, 43(4), 725-750. [DOI:10.1177/1042258717736857]
3. Anokhin, S. & Schulze, W. S. (2009). Entrepreneurship, innovation, and corruption. Journal of Business Venturing, 24(5), 465-476. [DOI:10.1016/j.jbusvent.2008.06.001]
4. Albulescu, C. T., and M. Tămăşilă(2016). Exploring the Role of FDI in Enhancing the Entrepreneurial Activity in Europe. The International Entrepreneurship and Management Journal 12: 629-657. [DOI:10.1007/s11365-015-0360-9]
5. Audretsch, D. B. Belitski, M. & Cherkas, N. (2021). Entrepreneurial ecosystems in cities: The role of institutions. PLoS ONE, 16(3), e0247609. [DOI:10.1371/journal.pone.0247609]
6. Bruce, D. & Schuetze, H. J (2004) The relationship between tax policy and entrepreneurship: What we know and what we should know. Swedish Economic Policy Review, 11(2).
7. Bruce,D, Liu,X .Murray,M,(2015) STATE TAX POLICY AND ENTREPRENEURSHIP, National Tax JournalVolume 68, Number 3S [DOI:10.17310/ntj.2015.3S.04]
8. Boudreaux, C. , & Caudill, S(2019). Entrepreneurship, Institutions, and Economic Growth: Does the Level of Development Matter?( No. 94244). University Library of Munich, Germany. [DOI:10.2139/ssrn.3424797]
9. Cullen, J. B., & Gordon, R. H. (2007). Taxes and entrepreneurial risk-taking: Theory and evidence for the US. Journal of Public Economics, 91(7-8), 1479-1505. [DOI:10.1016/j.jpubeco.2006.12.001]
10. Desai, S., Acs, Z. J., & Weitzel, U. (2013). A model of destructive entrepreneurship: Insight for conflict and postconflict recovery. Journal of Conflict Resolution, 57(1), 20-40 [DOI:10.1177/0022002712464853]
11. Djankov, S. Ganser, T. McLiesh, C. Ramalho, R. & Shleifer, A. (2010). The effect of corporate taxes on investment and entrepreneurship. American Economic Journal: Macroeconomics, 2(3), 31-64 [DOI:10.1257/mac.2.3.31]
12. Dreher, A. & Gassebner, M. (2013). Greasing the wheels? The impact of regulations and corruption on firm entry. Public Choice, 155(3-4), 413-432. [DOI:10.1007/s11127-011-9871-2]
13. Domar, E. D., & Musgrave, R. A. (1944). Proportional income taxation and risk-taking. The Quarterly Journal of Economics, 58(3), 388-422. [DOI:10.2307/1882847]
14. Dvouletý, O(2018). How to analyse determinants of entrepreneurship and self-employment at the country level? A methodological contribution. Journal of Business Venturing Insights, 9, 92-99. [DOI:10.1016/j.jbvi.2018.03.002]
15. David B. Audretsch & Maksim Belitski & Farzana Chowdhury & Sameeksha Desai, 2022. "Necessity or opportunity? Government size, tax policy, corruption, and implications for entrepreneurship," Small Business Economics, Springer, vol. 58(4), pages 2025-2042, April. [DOI:10.1007/s11187-021-00497-2]
16. Estrin, S., Korosteleva, J., & Mickiewicz, T. (2013). Which institutions encourage entrepreneurial growth aspirations? Journal of Business Venturing, 28(4), 564 [DOI:10.1016/j.jbusvent.2012.05.001]
17. Fairlie, R. W. Kapur, K. & Gates, S. (2011). Is employer-based health insurance a barrier to entrepreneurship? Journal of Health Economics, 30(1), 146-162. [DOI:10.1016/j.jhealeco.2010.09.003]
18. Fossen, F. M. & König, J. (2017). Public health insurance, individual health, and entry into self-employment. Small Business Economics, 49(3), 647-669. [DOI:10.1007/s11187-017-9843-0]
19. Edelman, L., & Yli-Renko, H. (2010). The impact of environment and entrepreneurial perceptions on venture-creation efforts: Bridging the discovery and creation views of entrepreneurship. Entrepreneurship Theory and Practice, 34(5), 833-856. [DOI:10.1111/j.1540-6520.2010.00395.x]
20. Hauner, D., & Kyobe, A. (2010). Determinants of government efficiency. World Development, 38(11), 1527-1542. [DOI:10.1016/j.worlddev.2010.04.004]
21. Henrekson, M. (2005). Entrepreneurship: A weak link in the welfare state? Industrial and Corporate Change, 14(3), 437-467. [DOI:10.1093/icc/dth060]
22. Heinemann, F. (2008). Is the welfare state self-destructive? A study of government benefit morale. Kyklos, 61(2), 237-257. [DOI:10.1111/j.1467-6435.2008.00400.x]
23. Holtz-Eakin, D. Penrod, J. R. & Rosen, H. S. (1996). Health insurance and the supply of entrepreneurs. Journal of Public Economics, 62(1-2), 209-235. [DOI:10.1016/0047-2727(96)01579-4]
24. Hoffmann, A.; Larsen, M.; Oxholm, A.S. Quality Assessment of Entrepreneurship Indicators; National Agency for Enterprise and Construction's Division for Research and Analysis (FORA): Copenhagen, Denmark, 2006.
25. Kuratko, D. F(2013). Entrepreneurship: Theory, Process, and Practice, Mason, Ohio: Cengage Learning.
26. Mauro, P. (1998). Corruption and the composition of government expenditure. Journal of Public Economics, 69(2), 263-279. [DOI:10.1016/S0047-2727(98)00025-5]
27. Méon, P. G. & Sekkat, K. (2005). Does corruption grease or sand the wheels of growth? Public Choice, 122(1-2), 69-97. [DOI:10.1007/s11127-005-3988-0]
28. Mohammadi Khiare Mohsen (2017), Investigating the impact of tax evasion and corruption on entrepreneurship: the study of OECD countries, Entrepreneurship Development, Fall 2017, Volume 11, Number 3; From page pp. 520-501.(in Farsi)
29. Mohammadzadeh, Parviz; Khan Goldizadeh, Samaneh; Kamangar, Shahram (2019); The impact of innovation and entrepreneurship on economic growth: a cross-country study; Iran Economic Research, 25th Spring 2019, No. 82, pp. 121-148.(in Farsi)
30. Nikolaev, B. N. Boudreaux, C. J. & Palich, L(2018). Cross‐country determinants of early‐stage necessity and opportunity‐motivated entrepreneurship: accounting for model uncertainty. Journal of Small Business Management, 56, 243-280. [DOI:10.1111/jsbm.12400]
31. Parker, S. C(2018). The economics of entrepreneurship. Cambridge University Press. [DOI:10.1017/9781316756706]
32. Rodrigues, B. G. & Soukiazis, E(2019). The Determinants of Entrepreneurship at the Country Level: A Panel Data Approach. Entrepreneurship Research Journal, 9(4), 1-17. [DOI:10.1515/erj-2016-0060]
33. Rose-Ackerman, S. (Ed.). (2007). International handbook on the economics of corruption. Edward Elgar Publishing. [DOI:10.4337/9781847203106]
34. Samadi, Ali Hossein and Mirhashmi, Seyed Mohammad (2016), investigating the effect of tax policies on entrepreneurial activities (a case study of resource-oriented, efficiency-oriented and innovative countries), Tax Research Journal, No. 25(33), pp. 1-20.(in Farsi)
35. Sedlacek, P. , & Sterk, V.( 2019). Reviving American Entrepreneurship? Tax Reform and Business Dynamism. Journal of Monetary Economics, 105, 94-108 [DOI:10.1016/j.jmoneco.2019.04.009]
36. Shleifer, A., & Vishny, R. W. (2002). The grabbing hand: Government pathologies and their cures. Harvard University Press.
37. Sayed, O.; Slimane, S.B. An Appraisal of the Determinants of Entrepreneurship in Developing Countries: The Case of the Middle East, North Africa and Selected Gulf Cooperation Council Nations. AJSS 2014, 4,63-74.
38. Tonoyan, V. Strohmeyer, R. Habib, M. & Perlitz, M. (2010). Corruption and entrepreneurship: How formal and informal institutions shape small firm behavior in transition and mature market economies. Entrepreneurship Theory and Practice, 34(5), 803-832. [DOI:10.1111/j.1540-6520.2010.00394.x]
39. Vidal-Suñé, A.; Lopez-Panisello, M.B. Institutional and economic determinants of the perception of opportunities and entrepreneurial intention. Investig. Reg. 2013, 26, 75-96.
40. Wennekers S. , Thurik, R. , 1999. Linking Entrepreneurship and Economic Growth, Small Business Economics13, p. 27-55. [DOI:10.1023/A:1008063200484]
41. Williamson, O. E. (2000). The new institutional economics: Taking stock, looking ahead. Journal of Economic Literature, 38(3), 595-613. [DOI:10.1257/jel.38.3.595]
Send email to the article author
| Rights and permissions | |
 |
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License. |
