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The economic effects of politically connected entrepreneurs on the quality and rate of regional entrepreneurship

Belitski, M. ORCID: https://orcid.org/0000-0002-9895-0105 and Grigore, A.-M. (2021) The economic effects of politically connected entrepreneurs on the quality and rate of regional entrepreneurship. European Planning Studies. ISSN 1469-5944

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To link to this item DOI: 10.1080/09654313.2021.1985436

Abstract/Summary

While research on institutional quality and entrepreneurship has consolidated over the last decade, the role that politically connected entrepreneurship (PE) plays in the perception of economic actors about the quality and a rate of entrepreneurial activity in their cities remains unanswered. The origin and nature of PE are heterogeneous, and it is associated with economic activity in a strong formal and informal cooperation with local and national governments to access resources in a privileged way. This study uses primary data from 1729 economics agents surveyed in 17 cities in East and Southeast Europe as well as Balkans and Central Asia. In order to better understand the consequences of PE, one should look at how it moderates the relationship between access to capital for entrepreneurs and the outcomes of entrepreneurial activity. We find that politically connected entrepreneurship may limit access to debt finance by other – non-politically economic actors, in particular in countries with a high level of corruption and market uncertainty. PE does not affect equity capital availability for entrepreneurship. Important policy implications are discussed for developing productive entrepreneurship in cities in emerging and developing economies.

Item Type:Article
Divisions:Henley Business School > Leadership, Organisations and Behaviour
ID Code:100701
Uncontrolled Keywords:Geography, Planning and Development
Publisher:Informa UK Limited

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