Drawing on institutional theory, we investigate the entrepreneurship implications of regulatory spillover. Regulatory spillover occurs when regulations in one country affect either the expected regulatory approach in another country and/or the entrepreneurial actions in another country. In the context of Initial Coin Offerings (ICOs), we theorize that a regulatory ban in countries (i.e., China, South Korea) causes a short-term increase in the number of low-quality ICOs in other countries and a long-term drop in the number of ICOs albeit with a higher average quality. We introduce new large sample quarterly data on ICOs from 108 countries and show results consistent with our theory.
Bellavitis, C., Cumming, D. J., & Vanacker, T. (Forthcoming). Ban, Boom, and Echo! Entrepreneurship and Initial Coin Offerings. Entrepreneurship Theory and Practice.