Discussion Paper Details

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Title: Roads Leading to Self-Employment: Comparing Transgenerational Entrepreneurs and Self-Made Start-Ups

Author(s): Boris Blumberg and Gerard Antonie Pfann

Publication Date: July 2015

Keyword(s): entrepreneurship, occupational choice, self-employment and transgenerational mobility

Programme Area(s): Labour Economics

Abstract: This paper studies the event history of business foundation and distinguishes between transgenerational entrepreneurship and self-made start-ups. Three theoretical concepts of human, financial and social capital are linked to investigate variations over time in the decision process to become self-employed. Data from a cohort of Dutch inhabitants born in 1939/1940 who have been interviewed three times during their lives in 1952, 1983, and 1993 allows testing theoretical hypotheses that state clear differences between these two paths towards business ownership. Empirical results show that the base-line hazard of individuals without self-employed parents increases with time, while people with entrepreneurial parents become self-employed at an early age. Moreover, social capital is a better predictor of enterprise than human capital.

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Bibliographic Reference

Blumberg, B and Pfann, G. 2015. 'Roads Leading to Self-Employment: Comparing Transgenerational Entrepreneurs and Self-Made Start-Ups'. London, Centre for Economic Policy Research.