The relationship between financial development and entrepreneurship: panel data analysis

Abstract

Entrepreneurship has been one of the most popular topics in recent years due to its continuing dynamism in the Modern Market Economy. Many recent studies investigate the financial obstacles and difficulties in the establishment of new companies and commercial entities. The purpose of this research is to define entrepreneurship and entrepreneurship concepts in detail, while explaining financial factors and financial mechanisms at the forefront of environmental factors affecting entrepreneurship in the world. Besides, what are the obstacles to entrepreneurship, and how entrepreneurship is influenced by the financial barriers will be explained. The aim is to reduce the number of entrepreneurs who obstruct the economic development.This study assumes that there is a positive relationship between entrepreneurship and four financial factors which are affordability of financial services, ease of access to loans, venture capital availability, and soundness of banks. In this context, four hypotheses related to these factors will be tested by population averaged panel data analysis.