We study the case of Vietnam to assess the long-lasting role of institutional and historical legacy on entrepreneurial outcomes. In particular, we investigate the detrimental effect of socialist institutions on entrepreneurship. Vietnam offers a uniquequasi-experimental setting because the country was divided into the socialist Northand the nonsocialist South for a relatively short period of two decades. After re-unification the South adopted the institutional framework conditions of the North. To assess the relationship between socialist history and entrepreneurship in this unique setting, we survey more than 3,000 North and South Vietnamese individuals more thanfour decades after the re-unification of the country. We find that North Vietnameserespondents have lower entrepreneurship intention, are less likely to select into entrepreneurship education programs, and are less willing to engage in business takeover.These patterns indicate the persistence of a long-lasting influence of historical differences in institutional framework conditions on entrepreneurship. The long-run effectof socialism on entrepreneurship is apparently deeper than previously discovered inthe prominent case of Germany, where differences in institutional treatment lasted formuch longer and ended more recently.
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