The GLO Discussion Paper of the Month of November 2019 explores the implications of post-communist party membership on the ethics and the nature of doing business in transition economies. It is found that former communist party members often become successful entrepreneurs. The Discussion Paper is the first study separating the causal effect of former communist party membership from self-selection.
GLO Discussion Papers are research and policy papers of the GLO Network which are widely circulated to encourage discussion. Provided in cooperation with EconStor, a service of the ZBW – Leibniz Information Centre for Economics, GLO Discussion Papers are among others listed in RePEc (see IDEAS, EconPapers). Complete list of all GLO DPs downloadable for free.
GLO Discussion Paper of the Month: November
GLO Discussion Paper No. 423, 2019
Former Communist party membership and present-day entrepreneurship in Central and Eastern Europe – Download PDF
by Ivlevs, Artjoms & Nikolova, Milena & Popova, Olga
GLO Fellows Milena Nikolova & Olga Popova
Author Abstract: After the collapse of Communism in Central and Eastern Europe, former party members were particularly likely to start businesses and become entrepreneurs. However, it remains unclear whether this entrepreneurial activity was driven by the resources, information and opportunities provided by former party membership or because people with specific individual attributes were more likely to become party members (self-selection). This study is the first to separate the causal effect of former Communist party membership from self-selection. Using individual-level Life in Transition–III survey and instrumental variables analysis, we find that, in Central and Eastern European countries, membership of former Communist party has facilitated business set-up but not business longevity. Our results also suggest evidence of negative self-selection, meaning that people who joined the former ruling party tended have fewer of the traits associated with entrepreneurship such as motivation, risk tolerance, and entrepreneurial spirit. We show that former Communist party membership still matters for business practices, business ethics, and the nature of doing business in transition economies.
GLO Discussion Papers of November 2019
426 The Mental Health Effects of Retirement – Download PDF
by Picchio, Matteo & van Ours, Jan C.
425 The Impact of Internship Experience During Secondary Education on Schooling and Labour Market Outcomes – Download PDF
by Neyt, Brecht & Verhaest, Dieter & Baert, Stijn
424 Training, Human Capital, and Gender Gaps in Entrepreneurial Performance – Download PDF
by Brixiová, Zuzana & Kangoye, Thierry
423 Former Communist party membership and present-day entrepreneurship in Central and Eastern Europe – Download PDF
by Ivlevs, Artjoms & Nikolova, Milena & Popova, Olga
422 Job Prestige and Mobile Dating Success: A Field Experiment – Download PDF
by Neyt, Brecht & Baert, Stijn & Vynckier, Jana
421 Greater US Gun Ownership, Lethality and Murder Rates: Analysis and Policy Proposals – Download PDF
by Schiff, Maurice
GLO DP Team
Senior
Editors: Matloob Piracha (University of Kent) & GLO; Klaus F.
Zimmermann (UNU-MERIT, Maastricht University and Bonn University).
Managing Editor: Magdalena Ulceluse, University of Groningen. DP@glabor.org
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