Journal of Applied Economic Research
ISSN 2712-7435
The Impact of Institutions and Spatial Effects on Entrepreneurship in the Russian Regions
N.B. Davidson, O.V. Sanaeva, E.A. Krivousova
Ural Federal University named after the First President of Russia B.N. Yeltsin, Ekaterinburg, Russia
Abstract
It is essential to develop entrepreneurship in Russia, both to promote economic growth of the country and its regions, and to create jobs and opportunities for highly qualified personnel. At the same time, institutions and spatial concentration of business are known to affect enterprise activity. The aim of our research is to estimate the role of institutional factors and spatial concentration in entrepreneurial activity in Russia's regions. We use panel data for 80 Russian regions covering the period from 2008 to 2018 and apply the system generalized method of moments. Our main contribution to the research on Russian regions is that in addition to institutional factors we estimate spatial effects, while performing a comprehensive analysis of entrepreneurial activity, i.e. considering small, medium, and large enterprises. The results of the empirical analysis show that the impact of institutional factors on entrepreneurship in Russia is varied. The number of economic crimes in the region negatively and significantly affects medium and large business. Corruption is found to be significant only for large business, while the level of the banking system and the risk index positively affect firms of all sizes. We also reveal a positive impact of entrepreneurship in the neighboring regions on the entrepreneurial activity in the region under consideration and confirm that spatial effects decline with distance. We conclude that institutional and spatial factors deserve attention while elaborating and implementing economic policy measures aimed at development of entrepreneurial activity. The heterogeneity of the development of entrepreneurship in the regions indicates the need for a differentiated policy in the field of entrepreneurship. An effective policy for one region may not be suitable for other regions, so government support should differ depending on the situation and the recipient. The results of our research can be useful for designing regional economic policy.
Keywords
entrepreneurship; small, medium and large business; institutional factors; spatial effects; system generalized method of moments (system GMM); regions of Russia.
JEL classification
O43, R11References
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Acknowledgements
Research was supported by the grant of the Russian Science Foundation № 19-18-00262 “Empirical modelling of balanced technological and socioeconomic development in the Russian regions”.
About Authors
Davidson Natalia Borisovna
Candidate of Economic Sciences, Associate Professor, Department of International Economics and Management, Ural Federal University named after the first President of Russia B.N. Yeltsin, Ekaterinburg, Russia (620002, Ekaterinburg, Mira street, 19); ORCID 0000-0002-6779-9561; e-mail: natalya.davidson@gmail.com.
Sanaeva Olga Vladimirovna
Master student, Department of Economics, Graduate School of Economics and Management, Ural Federal University named after the first President of Russia B.N. Yeltsin, Ekaterinburg, Russia (620002, Ekaterinburg, Mira street, 19); ORCID 0000-0002-9826-9547; e-mail: olg.sanaev@yandex.ru.
Krivousova Elena Alekseevna
Master student, Department of Economics, Graduate School of Economics and Management, Ural Federal University named after the first President of Russia B.N. Yeltsin, Ekaterinburg, Russia (620002, Ekaterinburg, Mira street, 19); ORCID 0000-0002-7723-7255; e-mail: lena.vorotnicova@mail.ru.
For citation
Davidson N.B., Sanaeva O.V., Krivousova E.A. The Impact of Institutions and Spatial Effects on Entrepreneurship in the Russian Regions. Journal of Applied Economic Research, 2021, Vol. 20, No. 4, 775-798. DOI: 10.15826/vestnik.2021.20.4.030.
Article info
Received August 31, 2021; Revised September 25, 2021; Accepted October 22, 2021.
DOI: http://dx.doi.org/10.15826/vestnik.2021.20.4.030
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