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War and Entrepreneurship: A Synthetic Control Study of the Russia-Ukraine Conflict

Author

Listed:
  • David B. Audretsch
  • Paul P. Momtaz
  • Hanna Motuzenko
  • Silvio Vismara
Abstract
Entrepreneurs are often situated in extreme environments characterized by violent conflict. Yet, war is largely a blind spot in entrepreneurship scholarship. As a first step to closing this gap, we offer a well-identified synthetic control study of entrepreneurial dynamics in the Russo-Ukrainian war. Relative to the synthetic counterfactual, Ukraine’s number of self-employed dropped by 20%, and the number of Ukrainian SMEs temporarily dropped by 14% but recovered within five years of the start of the conflict. In contrast, Russia had lost more than 1.4 million SMEs (42%) five years into the conflict. The disappearance of entrepreneurs is driven by both fewer new SMEs created and more existing SME closures. To pave the way for systematic scholarship on “war and entrepreneurship,” our study proposes a conceptual framework integrating conflict into the theory of entrepreneurial choice and suggests numerous avenues for future research.

Suggested Citation

  • David B. Audretsch & Paul P. Momtaz & Hanna Motuzenko & Silvio Vismara, 2023. "War and Entrepreneurship: A Synthetic Control Study of the Russia-Ukraine Conflict," CESifo Working Paper Series 10466, CESifo.
    • Handle: RePEc:ces:ceswps:_10466
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    File URL: https://www.cesifo.org/DocDL/cesifo1_wp10466.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    entrepreneurship; war; Russia-Ukraine conflict;
    All these keywords.

    JEL classification:

    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • N44 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Europe: 1913-
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements

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