Hacker News new | ask | show | jobs
by notsureifwant 4109 days ago
The two Olds papers both use clever triple difference designs (e.g. you're using change in entrepreneurship amongst those who've just become eligible for food stamps in one state relative to those who were already eligible as the treatment group, and the change in entrepreneurship amongst those same types of people in another state that didn't have a change in eligibility laws as the control group) which are hard to find fault in. It seems like a lot of people are arguing "other countries have strong welfare states, but less entrepreneurship", but that's a different question - most of the papers cited are arguing that in the United States, a strengthening of the welfare state leads to increased entrepreneurship. That does not mean that this would be true in other countries, nor that moving to a proper guaranteed minimum income would increase entrepreneurship, nor that entrepreneurship is the best measure of dynamism in the economy. But it is pretty convincing evidence that giving potential entrepreneurs the ability to fail at starting a business without too severe of consequences increases the rate at which they'll start businesses.
1 comments

One question I had was whether the overall rate of entrepreneurship increased. As you note, the papers seem to focus on rates within the population that receives the benefits, but the typical conservative argument is that the cost of those benefits in taxes retards economic growth overall. I'm not suggesting that they are right (as far as I know no substantial link has yet been found between low tax rates and economic growth), but it's a question worth addressing in the article and it was not.