Of free markets and a secular mind: the value of economic decentralization and individual secular values in entrepreneur
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Of free markets and a secular mind: the value of economic decentralization and individual secular values in entrepreneurship Pankaj C. Patel
&
Marcus T. Wolfe
Accepted: 3 September 2020 # Springer Science+Business Media, LLC, part of Springer Nature 2020
Abstract Building upon Hayek’s seminal work regarding the benefits of market decentralization, in this study, we examine the complementary role of an individual’s secular values in further explaining the association between decentralization of economic affairs, entrepreneurial activity, and self-employment. We argue that studies on Hayek’s notion of decentralization may be incomplete in their conceptualization without a transition to individual morality based on more secular values. We consider decentralization of economic affairs and secular values to explain why entrepreneurial activity differs across countries. In study 1, we find that the decentralization of economic affairs increases the odds of being an entrepreneur in a startup, but does not influence the likelihood of owning/managing a business or perceptions related to the opportunity to start a business. In study 2, we find evidence of mixed support for decentralization and self-employment; however, with meaningful effect sizes but with marginal significance, we find that an individual’s secular values complement the association between decentralization of economic affairs and self-employment. The findings are robust to Pankaj C. Patel and Marcus T. Wolfe contributed equally to this work. P. C. Patel Villanova School of Business, Villanova University, 800 E. Lancaster Avenue, Villanova, PA 19085, USA e-mail: [email protected] M. T. Wolfe (*) Price College of Business, University of Oklahoma, 307 W. Brooks - Rm. 206, Norman, OK 73019-0450, USA e-mail: [email protected]
alternate specifications. By demonstrating the role of secular values in strengthening decentralization, we lay the foundation for melding economic perspectives with the freedom from religious ethos as an important consideration for entrepreneurial activity. However, the mixed effects of decentralization on different modes of entrepreneurship also call into question the value of decentralization in modern economies. Plain English Summary Higher levels of individual secular values, even by a small amount, enhance the benefits that economic decentralization can have on entrepreneurial activity. In this paper, we use a twostudy approach to examine how individual secular values might influence the effects of economic decentralization on entrepreneurial activity. In study 1, we find that the decentralization of economic affairs increases the odds of being an entrepreneur in a startup, but does not influence the likelihood of owning/ managing a business or individual perceptions related to existing opportunities to start a business. In study 2, we find evidence of mixed support for the effects of economic decentralization on self-employment. However, we find some evidence suggesting that an individual’s secular values complement the ass
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