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How does entrepreneurship impacts unemployment

By Nguyen Thi Anh Thu (VNP 23)

Supervisor: Dr. Pham Dinh Long

Abstract:

The study investigates how does entrepreneurship impacts the unemployment. Since there are the ambiguities found in this relationship through not just theory but the empirical studies, the purpose of this study demonstrates this relationship by an equation vector autoregression model on two variable self-employment, a common measure of entrepreneurship, and the unemployment rate for data from 44 low-middle level income countries from 1992 to 2017. We find out that there is the negative relationship of self-employment associate to unemployment – refer to the “Schumpeter” effect. This conclusion reinforces previous arguments and clarifies the relationship of the entrepreneurship effect on unemployment; therefore the policymakers could review the law which support entrepreneurship activities to improve unemployment rates and the growth of economic.

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