Start-Ups

From Rags To Riches: How Robust Is The Influence Of Culture On Entrepreneurial Activity?

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Executive Summary

Entrepreneurial activity differs substantially across countries. While cultural differences have often been proposed as an explanation, measuring a country's cultural characteristics suffers from various problems. In this paper, the authors test the hypothesis that cultural factors influence entrepreneurial behavior by looking at differences in self-employment rates between immigrant groups within the same market. Such an approach allows holding constant factors such as the institutional and economic environment. Using U.S. census data for the year 2000, they find significant differences in the propensity to become self-employed across immigrants which is in line with previous findings.

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