The State of Entrepreneurship and Public Policy

Call for papers for: Journal of Entrepreneurship and Public Policy

10TH ANNIVERSARY SPECIAL ISSUE OF THE JOURNAL OF ENTREPRENEURSHIP AND PUBLIC POLICY

The Journal of Entrepreneurship and Public Policy (ISSN 2045-2101, Emerald Publishing) has published peer-reviewed research in the intersection of entrepreneurship and public policy since 2012. To celebrate the journal’s tenth anniversary, we invite submissions to a special issue with focus on issues in need of further study and directions for future research in this space. The special issue will be published during 2022.

 

Submission deadline:

1st October 2021

 

Formats:

Research articles (theory and/or empirical), synthetic essays, expert interviews, updated literature reviews. Max length for research articles is 10,000 words. All articles should be submitted by the deadline using the journal’s Manuscript Central site at https://mc.manuscriptcentral.com/jepp.

 

Guest editor:

Per Bylund, School of Entrepreneurship, Oklahoma State University, [email protected]

 

Overview

Economists have long been interested in how policy affect economic growth, especially through entrepreneurship. But their focus has been on the unidirectional effect rather than the dynamics of the relationship. The complex relationship between entrepreneurship and policy is comparatively understudied.

This is the research space that the Journal of Entrepreneurship and Public Policy has inhabited for the past decade. The journal has published on a wide range of topics in this intersection, including the role of inequality on entrepreneurial motivation (Baron, 2017), voter beliefs and business growth, (Malone & Koumpias, 2020), evasive entrepreneurship (Elert et al., 2016), the entrepreneurial rent (Henrekson & Stenkula, 2017), entrepreneurship in the informal economy (Williams & Nadin, 2012), implications of blockchain adoption for economic policy (Berg et al., 2019), entrepreneurship policy visions (Lucas et al., 2018), and much more.

 

Background

Entrepreneurship is generally recognized as a productive force and a cause of economic growth (Wennekers & Thurik, 1999), if not the “driving force” of the whole market economy (Mises, 1998a). However, it is not all or necessarily a force for good. Baumol (1990) famously argued that entrepreneurship may have both unproductive and destructive effects. The outcome of entrepreneurship thus appears contingent on the quality of the institutional setting (Boettke & Coyne, 2009; Sobel, 2008).

The relationship between entrepreneurship and institutions is not simple, however, but complex and bidirectional (Elert & Henrekson, 2017). Entrepreneurs act within and navigate the institutional setting (Bylund & McCaffrey, 2017) by adopting specific strategies, such as evasive or abiding action (Elert & Henrekson, 2016). The decision whether and how to start a venture and the nature of the opportunity pursued are contingent the institutional setting. In other words, institutions affect not only the outcome of entrepreneurship but also the frequency and its nature.

            The institutional setting is not a unified whole, however, but a complex interdependent system or hierarchy (Williamson, 2000). It comprises both formal and informal institutions (North, 1990), ranging from social norms and culture to price determination in spot market exchanges, as well as institutional voids (Mair & Marti, 2009). While some institutions support entrepreneurship, others have the opposite effect. As Sine and David (2010, p. 3) note, “Institutions indeed constitute many of the barriers and opportunities faced by entrepreneurs.”

            Williamson’s (2000) institutional model makes for a useful heuristic in which institutions are situated on four hierarchical levels. Somewhat simplified, the top level L1 is the realm of sociology with norms, traditions, and other informal institutional structures. The second level L2 is the formal institutional environment, the “rules of the game” studied in political science. The bottom two levels are traditionally analyzed in economics, with L4 being decentralized market exchanges and L3 governance structures such as firms.

Entrepreneurial action typically (but not always) resides on L3 and L4 (Bylund & McCaffrey, 2017), which are constrained by the formal rules in L2. These rules are typically recognized as interventions (Ikeda, 2004; Mises, 1998b) or regulations (Bylund, 2016) but can also subsidize entrepreneurs and entrepreneurship (Lerner, 2009). In both cases, they tend to lower the relative cost of abiding entrepreneurial action. But they can also motivate or even give rise to evading or altering entrepreneurial strategies.

Other perspectives add to the picture of these dynamics in the study of entrepreneurship and public policy. For example, Public Choice Theory applies economic tools to issues in political science in order to identify processes and underlying interests of actors (Buchanan & Tullock, 1965; Ostrom & Ostrom, 1971). This helps to uncover the potential for a symbiotic relationship between state and market actors, and, consequently, between politicians and entrepreneurs and business leaders through rent-seeking (Buchanan et al., 1980).

Adopting another perspective, Bylund (2016) leverages the ‘seen’-‘unseen’ dichotomy (Bastiat, 2010; Hazlitt, 2010) to produce a dynamic counterfactual for process analysis of the impact of regulations. His argument is that regulations have long-term implications for actors’ optionality (which he terms the ‘unrealized’) by affecting entrepreneurship and economic action more broadly than often is recognized.

Antitrust legislation and enforcement practice is yet another dimension of the study of entrepreneurship and public policy (Armentano, 1986) as is the question of when, how, and compared to what entrepreneurship creates social value (Lucas et al., 2018).

 

References

Armentano, D. T. (1986). Antitrust policy: the case for repeal. Cato Institute.

Baron, R. A. (2017). Income inequality: How efforts to reduce it can undermine motivation–and the pursuit of excellence. Journal of Entrepreneurship and Public Policy.

Bastiat, F. (2010). That Which Is Seen, and That Which Is Not Seen. An Economic Essay. World Library Classics. (1850)

Baumol, W. J. (1990). Entrepreneurship: Productive, Unproductive, and Destructive. Journal of political economy, 98, 893-919.

Berg, C., Davidson, S., & Potts, J. (2019). Capitalism after Satoshi: Blockchains, dehierarchicalisation, innovation policy, and the regulatory state. Journal of Entrepreneurship and Public Policy.

Boettke, P. J., & Coyne, C. J. (2009). Context matters: Institutions and entrepreneurship (Vol. 22). Now Publishers Inc.

Buchanan, J. M., Tollison, R. D., & Tullock, G. (1980). Rent-seeking society. College sta.

Buchanan, J. M., & Tullock, G. (1965). The calculus of consent: Logical foundations of constitutional democracy (Vol. 100). University of Michigan press.

Bylund, P. L. (2016). The seen, the unseen, and the unrealized: How regulations affect our everyday lives. Lexington Books.

Bylund, P. L., & McCaffrey, M. (2017). A theory of entrepreneurship and institutional uncertainty. Journal of Business Venturing, 32(5), 461-475.

Elert, N., & Henrekson, M. (2017). Entrepreneurship and Institutions: A Bidriectional Relationship. In IFN Working Papers. Stockholm: IFN.

Elert, N., Henrekson, M., & Wernberg, J. (2016). Two sides to the evasion: The Pirate Bay and the interdependencies of evasive entrepreneurship. Journal of Entrepreneurship and Public Policy.

Hazlitt, H. (2010). Economics in one lesson: The shortest and surest way to understand basic economics. Currency.

Henrekson, M., & Stenkula, M. (2017). The entrepreneurial rent: the value of and compensation for entrepreneurship. Journal of Entrepreneurship and Public Policy.

Ikeda, S. (2004). The dynamics of interventionism. Emerald Group Publishing Limited.

Lerner, J. (2009). Boulevard of broken dreams. Princeton University Press.

Lucas, D. S., Fuller, C. S., Piano, E. E., & Coyne, C. J. (2018). Visions of entrepreneurship policy. Journal of Entrepreneurship and Public Policy.

Mair, J., & Marti, I. (2009). Entrepreneurship in and around institutional voids: A case study from Bangladesh. Journal of Business Venturing, 24(5), 419-435.

Malone, T., & Koumpias, A. M. (2020). Comparing small business owner and voter beliefs regarding constraints on business growth. Journal of Entrepreneurship and Public Policy.

Mises, L. v. (1998a). Human Action: A Treatise on Economics. The Scholar's Edition. Ludwig von Mises Institute. (1949)

Mises, L. v. (1998b). Interventionism: An economic analysis (B. B. Greaves, Ed.). Foundation for Economic Education. (1940)

North, D. C. (1990). Institutions, Institutional Change and Economic Performance. Cambridge University Press.

Ostrom, V., & Ostrom, E. (1971). Public choice: A different approach to the study of public administration. Public Administration Review, 31(2), 203-216.

Sine, W. D., & David, R. J. (2010). Introduction. In W. D. Sine & R. J. David (Eds.), Institutions and Entrepreneurship (pp. 1-26). Emerald.

Sobel, R. S. (2008). Testing Baumol: Institutional Quality and the Productivity of Entrepreneurship. Journal of Business Venturing, 23(6), 641-655.

Wennekers, S., & Thurik, R. (1999). Linking Entrepreneurship and Economic Growth. Small Business Economics, 13(1), 27-56. https://doi.org/10.1023/a:1008063200484

Williams, C. C., & Nadin, S. J. (2012). Tackling entrepreneurship in the informal economy: evaluating the policy options. Journal of Entrepreneurship and Public Policy.

Williamson, O. E. (2000). The new institutional economics: taking stock, looking ahead. Journal of Economic Literature, 38(3), 595-613.