Working Paper
Entrepreneurship in a Unionised Economy
Mikko Leppämäki, Vesa Kanniainen
CESifo, Munich, 2000
CESifo Working Paper No. 379
CESifo, Munich, 2000
CESifo Working Paper No. 379
This paper shows that labor market institutions are important for the formation of new enterprises. The effects of labor market institutions on entrepreneurship, wage determination, and firm size are analysed analytically and illustrated numerically. The main result is that an increase in union power reduces the equilibrium rate of entrepreneurship and reduces the average size of enterprises.
Keywords: Entrepreneurship, labor market institutions, occupational choice, unions
JEL Classification: J230,J240,J510,M130