What makes a die-hard entrepreneur? Beyond the ‘employee or entrepreneur’ dichotomy

Bibliographic Data

ID14868645
AuthorsAndrew Burke (0000-0001-8635-3859, Cranfield University), Andrew E Burke, Felix R FitzRoy, FELIX FITZROY (0000-0001-7515-5902, IZA - Institute of Labor Economics), Michael A Nolan (0000-0001-6168-3448, University of Hull, corresponding author)
Year2008
Volume31
Issue2
Publication date2008-08-01
Peer ReviewedYes
Open AccessYes
TypeARTICLE
VenueSmall Business Economics (JOURNAL)
Journal identifiersISSN: 0921-898X • E-ISSN: 1573-0913
PublisherSpringer Science and Business Media LLC (PUBLISHER)
DOI10.1007/s11187-007-9086-6
OpenAlexW1972655897
LanguageEN
Citations received22
References cited32

The article makes three contributions to the economics literature on entrepreneurship. We offer a new measure of entrepreneurship which accounts for variations in persistence in self-employment and as a result avoids the weakness of approaches which categorise an individual as an entrepreneur by observing their occupation at just one point in their career. We outline an econometric methodology to account for this approach and find, via a statistical test of model selection, that it is superior to probit/logit models, which have dominated the literature. While our results indicate that this existing literature is good at explaining an individual’s propensity to try self-employment, we find that entrepreneurial persistence is determined by a different model and unearth some new insights. Early self-employment encourages entrepreneurial persistence. For men, inheritance encourages persistence, and facilitates initial self-employment. Having a self-employed father as a role model makes sons persist longer. However, somewhat surprisingly, early experience of unemployment does not affect the probability of self-employment, while reducing persistence. The popular ‘unemployment push effect’ is thus rejected in our sample

Econometrics · Economic growth · Economics · Entrepreneurship · Logit · Ordered probit · Persistence (discontinuity · Probit model · Sample (material · Self-employment · Unemployment · Entrepreneurship Studies and Influences · Family Business Performance and Succession · Firm Innovation and Growth