Political uncertainty on entrepreneurship

The environment of a country can influence entrepreneurial decision. Policy uncertainty is an important environmental factor and often is it seen as a barrier to entrepreneurial activity. The purpose of this study is to study the relationship between entrepreneurs and policy uncertainty using a simple regression model. In this regression model the cross-section and period fixed effects are taken into account. For this study a panel data which contains 109 observations of eight OECD countries is constructed. The results show that there is a small and positive effect of policy uncertainty on entrepreneurial activity