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Entrepreneurship, youth unemployment and macroeconomic policy : Lessons from Korea and Spain

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  • Entrepreneurship, youth unemployment and macroeconomic policy
  • Jang, Tae-Seok; Sacht, Stephen
  • Koreanisch-Deutsche Gesellschaft Fuer Wirtschaftswissenschaften


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Title Entrepreneurship, youth unemployment and macroeconomic policy
Similar Titles
Sub Title

Lessons from Korea and Spain

Material Type Articles
Author(English)

Jang, Tae-Seok; Sacht, Stephen

Publisher

[Cheonan] : Koreanisch-Deutsche Gesellschaft Fuer Wirtschaftswissenschaften

Date 2014-10
Journal Title; Vol./Issue Koreanische Zeitschrift fuer Wirtschaftswissenschaften:vol. 33(issue. 2)
Pages 22
Subject Country South Korea(Asia and Pacific)
Spain(Europe)
Language English
File Type Link
Subject Economy < Macroeconomics
Holding Christian-Albrechts-Universitat zu Kiel
License

Abstract

In this paper we shed light on the relationship between entrepreneurship, job creation and youth unemployment prior to and in the aftermath of the global financial crisis. We seek to understand the differences in macroeconomic and, in particular, labor market dynamics in Europe and East Asia. While our focus is on Korea and Spain, we discuss the situation, where the use of macroeconomic policy is largely ineffective in reducing high levels of youth unemployment after 2007 — with a most severe outcome for the member state in the European periphery. Based on our analysis, we recommend several policy measurements in order to strengthen entrepreneurial activity (as one of the main drivers for job creation) and, hence, reducing long-term youth unemployment. While policy makers should focus primarily on structural labor market reforms in the case of Spain (with respect to temporary job contracts and the minimum wage), the recent development of the Korean economy shows that investment in newly founded businesses should be supported by appropriate funding as well as macroeconomic stability, where the latter can help companies to navigate through difficult times.