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Post‐Socialist Culture and Entrepreneurship
Author(s) -
Runst Petrik
Publication year - 2013
Publication title -
american journal of economics and sociology
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.199
H-Index - 38
eISSN - 1536-7150
pISSN - 0002-9246
DOI - 10.1111/ajes.12022
Subject(s) - entrepreneurship , german , affect (linguistics) , political science , state (computer science) , action (physics) , sociology , economic system , political economy , economics , law , geography , physics , communication , archaeology , algorithm , quantum mechanics , computer science
In this article it is argued that locus of control beliefs and preferences concerning state action negatively affect the formation of new firms in former socialist countries. For this purpose K irzner's theory of costless entrepreneurship is reviewed and criticized. G erman reunification, in which the formerly socialist East Germany joined the Federal Republic of G ermany, represents an intriguing natural experiment in which the formal institutional structure of one nation was almost fully transplanted into another. Traditional as well as psychological factors are examined. The results suggest that about one‐third of the east‐west gap in new self‐employment can be explained by inert informal institutions.