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Entrepreneurship and income inequality: a spatial panel data analysis

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  • Hanen Ragoubi
  • Sana El Harbi

Abstract

The main objective of this paper is to empirically analyze the relationship between entrepreneurship and income inequality. We use a spatial panel data analysis for both 33 high-income countries and 39 middle- and low-income countries over a period of 11 years. Estimation results and rigorous diagnostic analysis suggest that: (i) there is a strong support for the existence of an inverted U-shaped relationship between entrepreneurship and income inequality espoused by the Kuznets Curve hypothesis; (ii) the relationship between entrepreneurship and income inequality is negatively moderated by country’s level of economic development; (iii) regardless of income inequality levels, entrepreneurship has a non-linear relationship with income per capita; (iv) gross domestic expenditure on research and development exhibits significant negative impacts on entrepreneurship; (v) significant mixed effects on the likelihood of entrepreneurial activity are observed with governance, globalization, population growth rate, and competitiveness variables; (vi) there are significant mixed feedback effects on entrepreneurship; and (vii) there are statistically significant, positive as well as negative spatial spillovers to country-level entrepreneurial activity.

Suggested Citation

  • Hanen Ragoubi & Sana El Harbi, 2018. "Entrepreneurship and income inequality: a spatial panel data analysis," International Review of Applied Economics, Taylor & Francis Journals, vol. 32(3), pages 374-422, May.
    • Handle: RePEc:taf:irapec:v:32:y:2018:i:3:p:374-422
    DOI: 10.1080/02692171.2017.1342776
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    Cited by:

    1. Byron Quito & María de la Cruz del Río‐Rama & José Álvarez‐García & Ronny Correa‐Quezada, 2022. "Impact factors and space‐time characteristics of income inequality in a global sample," Sustainable Development, John Wiley & Sons, Ltd., vol. 30(6), pages 1850-1868, December.
    2. Arogundade, Sodiq, 2021. "Be Nice to thy Neighbours: Spatial impact of Foreign Direct Investment on Poverty in Africa," MPRA Paper 111789, University Library of Munich, Germany.
    3. Lawrence Adu Asamoah & Francesco Figari & Andrea Vezzulli, 2021. "Spillover effects of innovation and entrepreneurial activity on income inequality in developing countries: A spatial panel approach," Regional Science Policy & Practice, Wiley Blackwell, vol. 13(5), pages 1661-1686, October.
    4. Abdullah Al Mamun & Noorshella Binti Che Nawi & Mohd Asrul Hery Bin Ibrahim & Rajennd Muniady, 2018. "Effect of Economic Vulnerability on Competitive Advantages, Enterprise Performance and Sustainability," Social Sciences, MDPI, vol. 7(4), pages 1-11, April.
    5. Francesco Di Lorenzo & Mariarosa Scarlata, 2019. "Social Enterprises, Venture Philanthropy and the Alleviation of Income Inequality," Journal of Business Ethics, Springer, vol. 159(2), pages 307-323, October.
    6. Byron Quito & María de la Cruz del Río-Rama & Marta Peris-Ortiz & José Álvarez-García, 2024. "Spatial-Temporal Determinants of Income Inequality in the Cantons of Ecuador between 2010 and 2019: a Spatial Panel Econometric Analysis," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(2), pages 7744-7768, June.
    7. Iman Cheratian & Saleh Goltabar & Carla Daniela Calá, 2021. "Spatial drivers of firm entry in Iran," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 66(2), pages 463-496, April.
    8. Rajeev K. Goel & James W. Saunoris, 2020. "Does income inequality sand or grease the wheels of entrepreneurial activity? International evidence," Australian Economic Papers, Wiley Blackwell, vol. 59(2), pages 138-160, June.
    9. Gregor Mager & Anja Faße, 2024. "The contribution of smallholders' livelihood activities on income inequality and poverty: Case study from rural Tanzania," Journal of International Development, John Wiley & Sons, Ltd., vol. 36(1), pages 644-676, January.
    10. Shadrack Notob Dackyirekpa & Gao Liang & Isaac Ahakwa & Comfort Andoh, 2024. "How does income level, cultural values, and government support influence entrepreneurship: an integrated framework," Journal of Global Entrepreneurship Research, Springer;UNESCO Chair in Entrepreneurship, vol. 14(1), pages 1-15, December.
    11. María-Teresa Aceytuno & Celia Sánchez-López & Manuela A. de Paz-Báñez, 2020. "Rising Inequality and Entrepreneurship during Economic Downturn: An Analysis of Opportunity and Necessity Entrepreneurship in Spain," Sustainability, MDPI, vol. 12(11), pages 1-16, June.
    12. Sara Proença & Elias Soukiazis, 2023. "The process of sustainable entrepreneurship: a multi-country analysis," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 25(10), pages 10995-11010, October.

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