Influence of institutional economics on firm birth and death: A comparative analysis of hospitality and other industries
تأثیر اقتصاد نهادی بر تولد و مرگ محکم: یک تحلیل مقایسه ای از مهمان نوازی و سایر صنایع-2020
This paper investigates how public policies, such as taxes and regulations inﬂuence ﬁrm formation (birth) and closure (death) in the hospitality and other industries in the United States (US), using an institutional economics approach and the dimensions of the Economic Freedom of North America (EFNA) index. The literature has been scant when it comes to examining the eﬀects of policies of formal institutions on ﬁrms’ birth and death in the hospitality industry, and whether these eﬀects in hospitality diﬀer from those of other sectors. The study uses panel data from government sources and the EFNA dimensions and applies cross-sectional dependence and unit root tests, followed by a panel generalized least square approach for the analysis. Our ﬁndings show that components of economic freedom have varying eﬀects on ﬁrms’ birth and death. The study provides practical contributions for policymakers and managers by improving the understanding of ﬁrm births and deaths in the US.
Keywords: Entrepreneurship | Hospitality industry | Economic | freedom | Institutional economics | Firm birth and death | Public policies