Entrepreneurship and Natural Resource Rents: Evidence from Excessive Entrepreneurial Activity

Abstract

This study investigates the impact of excessive entrepreneurial activity on natural resource rents. We employ the ecological perspective to argue that while entrepreneurship is usually associated with innovation and improved efficiency, and thus reduced natural resource rents, excessive entrepreneurial activity may increase natural resource rents and harm the environment. Investigating a global sample of 70 countries over 11 years (2006–2016) using advanced techniques to address econometric issues, we find initial evidence supporting the natural resource rents of excessive entrepreneurship. We also find heterogeneity between high-income economies (HIEs) and low and middle-income economies (LMEs) as well as between four vital natural resources: coal, gas, forest, and minerals. The findings in this study contribute to the growing literature examining sustainable entrepreneurial ecosystems.