The impact of China’s “streamlining administration and delegating power” policy on entrepreneurship: an application of Hsiao et al.’s panel data method

ABSTRACT

Using pandel data from 2006-2020 and 91 countries, this paper estimates the impact of China’s policy of ‘streamlining administration and delegating power’ (SADP) on entrepreneurship. By adopting Hsiao et al’s panel data method, this paper constructs a counterfactual treatment group and evaluate the impact effectively. The results indicate that the policy of SADP significantly promotes entrepreneurship in China. Furthermore, we find that this result persists across three robustness checks: a placebo test, a leave-one-out test, and the rescreening of potential control countries. Our results suggest that other countries may find beneficial effects on entrepreneurial activity by adopting similar policies.

JEL CLASSIFICATION:

• Entrepreneurship
• China
• SADP policy
• panel data

JEL CLASSIFICATION:

• C52
• L51
• M13

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Funding

This paper is financially supported by National Social Science Foundation of China [grant number 19BJY015]