The outlier phenomenon in entrepreneurship and economic growth: mollycoddling policies create New Zealand's perfect storm

Howard Frederick, Erik Monsen

Research output: Contribution to journalArticle


Analyzing GEM 2005 data, we confirm that entrepreneurship and economic development form a U-shaped curve. We seek to understand New Zealand’s large deviation from the modeled curve by factor-analyzing all countries’ deviations from the curve. We make recommendations that would move New Zealand toward the trend line and thus aid in increasing its level of economic development. Our findings indicate that measures that overprotect workers, spoil incentives, or indulge welfare passivity can stymie economic growth even in conditions of high entrepreneurial activity.
Original languageEnglish
Article numberArticle 2
Number of pages16
JournalFrontiers of Entrepreneurship Research
Issue number20
Publication statusPublished - 2006



  • entrepreneurship
  • economic growth strategies

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