%0 Report
        %A Schwidrowski, Zuzana Brixiova
%A Ncube, Mthuli
        %T Entrepreneurship and the Business Environment in Africa: An Application to Ethiopia
        %D 2013
        %8 2013 Aug
        %I Institute of Labor Economics (IZA)
        %C Bonn
        %7 IZA Discussion Paper
        %N 7553
        %U https://www.iza.org/index.php/publications/dp7553
        %X Since mid-2000s, Ethiopia has been one of the fastest growing countries in the world. However, productive entrepreneurship in high-value added activities has made limited contributions to this growth, in part because of a weak business environment. Moreover, the low-productive firms in the informal sector still account for a large share of employment. Reflecting these facts, this paper presents a model of costly entrepreneurial start-ups in an economy with a large informal sector and rigid business environment where an equilibrium outcome can be a low-skill, low-productivity trap. By fostering productive start-ups and skilled employment, creation of an enabling business environment could help move the Ethiopian economy into high-productivity equilibrium.
        %K entrepreneurship
%K SME start-ups
%K low productivity trap
%K multiple equilibria
%K Africa