Entrepreneurship Snapshots 2010 : Measuring the Impact of the Financial Crisis on New Business Registration
New businesses are likely to have been even more severely affected by the crisis than mature businesses, even in non crisis times, new and young firms tend to be more constrained than older firms which often have established reputations and enjoy e...
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| Format: | Publication |
| Language: | English |
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World Bank
2012
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| Online Access: | http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000356161_20101207021701 http://hdl.handle.net/10986/2537 |
| Summary: | New businesses are likely to have been
even more severely affected by the crisis than mature
businesses, even in non crisis times, new and young firms
tend to be more constrained than older firms which often
have established reputations and enjoy easier access to
finance. Given the sudden scarcity of credit and the
uncertain economic outlook, it is reasonable to assume that
entrepreneurs wanting to start a new business or register an
existing informal business were hit especially hard by the
downturn. Until now, however there has been a lack of
comprehensive evidence to support this assumption. The
impact of the 2008-09 financial crises on new business
creation should be of special interest given the importance
of entrepreneurs and young firms to the continued dynamism
of the modern market economy; it is well established that a
robust entry rate of new business can foster competition and
economic growth. This report hypothesizes that although
economies with more developed financial markets were hit
harder by the crisis, they will enjoy stronger and quicker
recoveries in new firm creation. |
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