Entrepreneurship and Income Inequality: A Spatial Econometric Approach
DOI:
https://doi.org/10.25071/1874-6322.40434Keywords:
Entrepreneurship; income inequality; spatial econometricsAbstract
This paper extends research on the link between entrepreneurship and income inequality by introducing spatial considerations. Following a battery of specification tests, we model the relationship between entrepreneurship and inequality using a dynamic spatial Durbin model. Using data from the 48 continental U.S. states, we obtain strong evidence that entrepreneurship within a state not only affects inequality within that state, but has cross-state effects, as well.