Rostam-Afschar (Empir Econ 47:1067–1101, 2014) analyzes the impact of the deregulation of the German Trade and Crafts Code of 2004 on entrepreneurial activity, using German microcensus (MC) data. He finds a uniform positive effect on market entry in partially and fully deregulated trades and no change in exit probabilities. We replicate and extend this study. Most importantly, we generate a novel classification scheme that aims to achieve an improved identification of crafts trades in the microcensus. It is necessary to remove non-craftsmen from the analysis as the policy change exclusively pertains to the crafts sector. In contrast to Rostam-Afschar’s findings, the increase in self-employment and entry is more pronounced in the completely deregulated B1-trades rather than the partially deregulated A-trades. In addition, exit probabilities in fully deregulated trades do not remain constant but rather increase.
CITATION STYLE
Runst, P., Thomä, J., Haverkamp, K., & Müller, K. (2019). A replication of ‘Entry regulation and entrepreneurship: a natural experiment in German craftsmanship.’ Empirical Economics, 56(6), 2225–2252. https://doi.org/10.1007/s00181-018-1457-0
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