Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/262040 
Year of Publication: 
2022
Series/Report no.: 
IFN Working Paper No. 1426
Publisher: 
Research Institute of Industrial Economics (IFN), Stockholm
Abstract: 
Formal institutions, e.g., regulations, are considered crucial determinants of entrepreneurship, but what enables regulatory change when there is a regulatory void, meaning entrepreneurship clashes with existing regulations? Drawing on public choice theory, we hypothesize that regulatory freedom facilitates the introduction of legislation to fill such voids. We test this hypothesis using unique data documenting the time for ridesharing to become legalized at the state level across the United States following its local (and often illegal) rollout. Results suggest states with greater regulatory freedom passed ridesharing legislation quicker, highlighting an underappreciated way that extant regulatory freedom facilitates the accommodation of entrepreneurship.
Subjects: 
entrepreneurship
innovation
regulation
institutional change
institutional voids
institutional entrepreneurship
sharing economy
economic freedom
survival analysis
JEL: 
C21
O31
R49
Document Type: 
Working Paper

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