IDEAS home Printed from https://ideas.repec.org/a/eme/jepppp/jepp-d-18-00031.html
   My bibliography  Save this article

Foreign aid: boosting or hindering entrepreneurship?

Author

Listed:
  • Shaomeng Jia

Abstract

Purpose - The current literature has not made any connection between foreign aid and entrepreneurship. The purpose of this paper is to investigate if foreign aid influences entrepreneurial activities in a recipient country. Design/methodology/approach - Using system generalized method of moments (Blundell and Bond, 1998) estimators with a panel of 38 recipient countries during 2005–2014, the author tests for 33 measures of entrepreneurial activities. Findings - This paper finds that aggregate aid tends to only boost necessity-driven early-stage entrepreneurship and benefit low-income entrepreneurs. Aid to infrastructure promotes entrepreneurship driven by both opportunity and necessity motivations. It also incentivizes competition with homogeneous products. Additionally, evidence suggests that both aggregate aid and infrastructural aid discourage adoption of state-of-the-art technologies, raise business failure rate and are associated more with necessity-driven early-stage entrepreneurial activities for females. Originality/value - This is the first research examining “aid and entrepreneurship” relation.

Suggested Citation

  • Shaomeng Jia, 2018. "Foreign aid: boosting or hindering entrepreneurship?," Journal of Entrepreneurship and Public Policy, Emerald Group Publishing Limited, vol. 7(3), pages 248-268, August.
    • Handle: RePEc:eme:jepppp:jepp-d-18-00031
    DOI: 10.1108/JEPP-D-18-00031
    as

    Download full text from publisher

    File URL: https://www.emerald.com/insight/content/doi/10.1108/JEPP-D-18-00031/full/html?utm_source=repec&utm_medium=feed&utm_campaign=repec
    Download Restriction: Access to full text is restricted to subscribers
    File URL: https://www.emerald.com/insight/content/doi/10.1108/JEPP-D-18-00031/full/pdf?utm_source=repec&utm_medium=feed&utm_campaign=repec
    Download Restriction: Access to full text is restricted to subscribers
    File URL: https://libkey.io/10.1108/JEPP-D-18-00031?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Gnangnon, Sèna Kimm, 2022. "Duration of WTO Membership and Investment-Oriented Remittances Flows," EconStor Preprints 251274, ZBW - Leibniz Information Centre for Economics.
    2. Raquel Ortega-Argilés, 2022. "The evolution of regional entrepreneurship policies: “no one size fits all”," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 69(3), pages 585-610, December.
    3. Folorunsho M. Ajide & Tolulope T. Osinubi, 2022. "Foreign aid and entrepreneurship in Africa: the role of remittances and institutional quality," Economic Change and Restructuring, Springer, vol. 55(1), pages 193-224, February.
    4. Sèna Kimm Gnangnon, 2023. "Effect of Aid-for-Trade Flows on Investment-Oriented Remittance Flows," JRFM, MDPI, vol. 16(2), pages 1-36, February.
    5. Gnangnon, Sèna Kimm, 2021. "Effect of Development Aid on Productive Capacities," EconStor Preprints 233973, ZBW - Leibniz Information Centre for Economics.
    6. Gnangnon, Sèna Kimm, 2023. "Duration of membership in the world trade organization and investment-oriented remittances inflows," The Quarterly Review of Economics and Finance, Elsevier, vol. 88(C), pages 258-277.
    7. Tomi Ovaska & Ryo Takashima, 2020. "Caveat Emptor: Foreign Aid and Entrepreneurship," Economies, MDPI, vol. 8(1), pages 1-13, January.

    More about this item

    Keywords

    Foreign aid; Entrepreneurship; Development; F35; O11; O19; L26;
    All these keywords.

    JEL classification:

    • F35 - International Economics - - International Finance - - - Foreign Aid
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O19 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eme:jepppp:jepp-d-18-00031. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Emerald Support (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.