The importance of export diversification for national entrepreneurship density

Abstract

Economic integration is increasingly recognized as an important determinant of entrepreneurship. This study thus employs institutional theory to examine the influences of structural changes of export dynamics via export diversification on entrepreneurship in a global sample of 61 countries over the period 2006–2014. Results from Panel-Corrected Standard Errors estimators show that overall export diversification and export-intensive margins have negative effects on entrepreneurship, while export-extensive margin has a positive effect on entrepreneurship. Moreover, this study also reveals that export diversification may have a stronger contribution to entrepreneurship in low and middle-income economies (LMEs) than high-income economies (HIEs).