Determinants of the New Companies Formation in E.U Member Countries. An Autoregressive ARDL Model Approach

Abstract

This article searches for influential factors on new companies’ formation in a number of 26 EU Member States during the 2009-2019 period basing on available statistical data of this. In such an order data were panel organized and an ARDL (autoregressive distribution lag) model was estimated as the result of unit root tests for stationarity of variables with different level of integration (I0 ;I1). The main advantages of such a model used is that we can obtain an image of long run and short run associations between model variables for all countries. In addition, the ARDL model will take into account heterogeneity (differences) among countries by allowing for country specific variables. Significant results for long run association between variables for most countries were obtained, except for: Belgium, Germany, Estonia, Spain, France, Hungary and Austria; short run associations will be presented also individually for each of the 26 countries implied.

Keywords

• enterprise birth rates
• entrepreneurship environment
• eu entrepreneurship
• determinants of new enterprises formation