Cultural hysteresis, entrepreneurship and economic crisis

Angelis, Vassilis; Tubadji, Annie; Nijkamp, Peter; Angelis, Vasilis

Abstract

© 2016 The Author 2016. Published by Oxford University Press on behalf of the Cambridge Political Economy Society. All rights reserved. Entrepreneurship has been advocated as one of the major solutions for coping with (youth) unemployment in Europe during the recent economic downturn. Entrepreneurial activity is generally co-determined by economic and cultural factors. However, cultural change normally requires a much longer time to take place than economic changes do. This may prompt a so-called cultural hysteresis effect in the efficiency of entrepreneurial incentives. To analyze these effects, data from the Global Entrepreneurship Monitor (2003-2010) are used. A Two-Stage Least Square instrumental variable and a logit model with difference-in-differences are employed. We find that the cultural hysteresis is less prominent among Mediterranean countries. Moreover, it is almost negligible in the response to incentives by female youth.

Citation

Angelis, V., Tubadji, A., Nijkamp, P., & Angelis, V. (2016). Cultural hysteresis, entrepreneurship and economic crisis. Cambridge Journal of Regions, Economy and Society, 9(1), 103-136. https://doi.org/10.1093/cjres/rsv035

• Journal Article Type: Article
• Acceptance Date: Dec 14, 2015
• Online Publication Date: Feb 19, 2016
• Publication Date: Mar 1, 2016
• Journal: Cambridge Journal of Regions, Economy and Society
• Print ISSN: 1752-1378
• Electronic ISSN: 1752-1386
• Publisher: Oxford University Press (OUP)
• Peer Reviewed: Peer Reviewed
• Volume: 9
• Issue: 1
• Pages: 103-136
• DOI: https://doi.org/10.1093/cjres/rsv035
• Keywords: hysteresis, persistence, risk preferences, uncertainty, local disparities
• Public URL: https://uwe-repository.worktribe.com/output/913687
• Publisher URL: https://doi.org/10.1093/cjres/rsv035