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Do government and legal barriers impede entrepreneurship in the U.S.? An exploratory study of perceived vs. actual barriers

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  • Kwapisz, Agnieszka

Abstract

In this exploratory study, we investigate how the actual and the perceived level of government bureaucracy correlates with nascent ventures' outcomes, a largely understudied topic in entrepreneurship literature. We use data merged (N = 922) from the U.S. Panel Study of Entrepreneurial Dynamics II (PSED II)—which tracked nascent startups over a six-year period—and the Economic Freedom of North America Index from the Fraser Institute. We find no relationship between state-level economic freedom and startups' outcomes and no relationship between the actual and the perceived government bureaucracy. Additionally, government is perceived as a major barrier by only 6% of entrepreneurs (of whom only 54% actually check government regulations), and 1% of entrepreneurs list regulations as the main reason for quitting the startup process. Overall, our results suggest that government and legal barriers are not significantly related to nascent startups’ outcomes and are not major barriers for entrepreneurs.

Suggested Citation

  • Kwapisz, Agnieszka, 2019. "Do government and legal barriers impede entrepreneurship in the U.S.? An exploratory study of perceived vs. actual barriers," Journal of Business Venturing Insights, Elsevier, vol. 11(C), pages 1-1.
    • Handle: RePEc:eee:jobuve:v:11:y:2019:i:c:20
    DOI: 10.1016/j.jbvi.2019.e00114
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    Cited by:

    1. Brian Chung & Philip Hans Franses & Enrico Pennings, 2024. "Conditions that make ventures thrive: from individual entrepreneur to innovation impact," Small Business Economics, Springer, vol. 62(3), pages 1177-1200, March.
    2. Bach Nguyen & Nguyen Phuc Canh & Su Dinh Thanh, 2021. "Institutions, Human Capital and Entrepreneurship Density," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 12(3), pages 1270-1293, September.
    3. Cai Li & Naveed Ahmed & Sikandar Ali Qalati & Asadullah Khan & Shumaila Naz, 2020. "Role of Business Incubators as a Tool for Entrepreneurship Development: The Mediating and Moderating Role of Business Start-Up and Government Regulations," Sustainability, MDPI, vol. 12(5), pages 1-23, February.
    4. Dmitry Khanin & Robert Rosenfield & Raj V. Mahto & Cherry Singhal, 2022. "Barriers to entrepreneurship: opportunity recognition vs. opportunity pursuit," Review of Managerial Science, Springer, vol. 16(4), pages 1147-1167, May.
    5. Kwapisz, Agnieszka, 2020. "Health insurance coverage and sources of advice in entrepreneurship: Gender differences," Journal of Business Venturing Insights, Elsevier, vol. 14(C).
    6. Marina Solesvik & Paul Westhead, 2019. "Fostering of Entrepreneurship Competencies and Entrepreneurial Intentions in a Weak Ecosystem," Foresight and STI Governance (Foresight-Russia till No. 3/2015), National Research University Higher School of Economics, vol. 13(4), pages 60-68.
    7. Kamran Hameed & Noman Arshed & Kenneth A. Grant & Mubbasher Munir & Osama Aziz, 2023. "Forces of Dynamic Capability and Incidence of Entrepreneurship: A Macroeconomic Policy Intervention Approach," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 14(4), pages 3573-3597, December.
    8. Shahid, Pirzada Syed Rizwan, 2023. "Founder's Human Capital and the Entrepreneurial Process Duration," OSF Preprints yf6mg, Center for Open Science.
    9. Kwapisz Agnieszka, 2020. "Minimum Wages and Nascent Entrepreneurship in the US," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 20(1), pages 1-15, January.

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