TV and entrepreneurship

Can TV influence the entrepreneurial decisions of individuals? To identify causal effects, we utilize a quasi-natural experiment, namely that during the division of Germany after WWI into the capitalistic West Germany and the socialistic East Germany, West TV was exogenously available only in some regions of the latter. Using regional and individual data, we show that, after the Reunification, entrepreneurship is higher among the residents of East German regions with West TV signal, indicating a direct effect of TV on the entrepreneurial mindset of exposed individuals. Moreover, we find second-order effects due to intergenerational transmission, which cause persistent differences.