Does Corruption Affect Social and Commercial Entrepreneurs Differently?

This article investigates the relationship between corruption and entrepreneurship on the macro level. This relationship has been scarcely investigated so far, and little is known of it besides a ypothesized negative effect on entrepreneurship. In particular, what we do not know is whether corruption affects social and ommercial entrepreneurship differently. Given the inability of governments worldwide to effectively tackle social issue, discovering the determinants of a potential solution - social entrepreneurship - is highly relevant. Although research exists which includes corruption in its analysis, corruption itself is not the main variable of interest – marking a research gap. The following analysis is based on the internationally comparable data of the General Entrepreneurship Monitor (GEM) 2009, and encompasses 48 countries at different levels of development. Moreover, the main theoretical framework is build upon the institutional void and support theories. That is, this paper posits the discussion about corruption and entrepreneurship in the context of the ongoing debate for the determinants of social entrepreneurship. Based on multiple regression analysis, the findings suggest a negative relationship between social early-stage entrepreneurship (SEA) and corruption, while total early-stage entrepreneurship (TEA) is positively related with corruption levels. These findings contribute to the support of the institutional support theory over the institutional void theory, and pave an avenue for further study of the relationship between entrepreneurship, income, and corruption.