What role does entrepreneurship play for explaining economic growth differences in Canada?

What is it about?

This paper looks at various factors that explain why regions (here: Canadian provinces) grow at different speeds in economic terms. This economic growth is considered in terms of regional income differences, while the factors that explain such regional differences include: a region's level of education, the degree of urbanization, the extent to which minorities are present in these provinces, to what extent migration has occurred, to what extent trade is open, and to what extent non-agricultural self-employment is prevalent. In light of the omission of such self-employment in previous empirical studies on Canada that have aimed to explain regional growth differences, this paper provides novel evidence that self-employment (here used as a measure of entrepreneurship) is playing a crucial role in explaining regional growth differences and their changes over time.

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Why is it important?

It is not only important because previous Canadian studies have omitted to account for entrepreneurship in explaining regional growth differences, but also since this opens up new avenues for policymakers to do something about undesirable income growth disparities, i.e. use measures that relate to entrepreneurship to impact (reduce) such growth disparities.