| 12.11.2019

Doctoral thesis: The impact of policies on entrepreneurship differs depending on the country

The impact of policies on quantity and quality of entrepreneurship in a country depends on the informal rules of society, e.g. culture of not registering business activities, in that specific country, concludes Ashkan Mohamadi in his doctoral thesis.

According to Ashkan Mohamadi’s study, the same policy could have different effects on entrepreneurship in different places, depending on how a society functions through informal rules of the game. If the policies are in contrast with what the society expects, the impacts on entrepreneurship could be different from what was intended.

“In my thesis, I attempted to shed light on the question: How to make policy for entrepreneurship? To develop these arguments, my thesis advances the discussions within institutional theory by establishing the concept of institutional incongruence. That happens when regulations are not in line with informal rules of the game. An example is when a society accept and expect power distance, but the government introduce high progressive taxes”, says Ashkan Mohamadi. 

Another example is empirically tested in the thesis: If social groups (e.g. customers, partners, suppliers, investors) surrounding entrepreneurs in a country expect them not to formally register their business, a policy fiercely to enforce registration could have negative impacts on quality of entrepreneurship. In a country in which unregistered business activities are less acceptable by the society, in contrast, such policy could lead to clarity which in turn favours entrepreneurship.

As such, Ashkan Mohamadi asserts that policies to improve entrepreneurship should also consider the informal rules of the game within a society. A policy that targets both regulative (law and regulation) and cognitive (taken-for-granted-informal rules in a society) institutions could enhance quantity and quality of entrepreneurship in a country.

You can read the whole thesis here.

Ashkan Mohamadi will defend his doctoral thesis in Entrepreneurship, Management and Organisation, “Entrepreneurial Opportunity Exploitation under Different Institutional Settings” on Friday 15 November 2019 at noon.

Place: Hanken School of Economics, Vaasa
Opponent and university: Håkan Boter, Umeå School of Business and Economics (USBE)
Custos: Professor Sören Kock

More information:
Ashkan Mohamadi              
Phone: 040 6797 472