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What makes a Die-Hard Entrepreneur? Trying, or Persisting in, Self-Employment

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Author Info
Andrew E. Burke
Michael A. Nolan
Felix R. FitzRoy
Abstract

The paper 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. We outline an econometric methodology to account for this approach and find 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 into the roles of early career experience, finance, role models, gender and the unemployment push effect.

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Paper provided by Max Planck Institute of Economics, Group for Entrepreneurship, Growth and Public Policy in its series Discussion Papers on Entrepreneurship, Growth and Public Policy with number 2005-23.

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Length: 38 pages
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Handle: RePEc:esi:egpdis:2005-23

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Related research
Keywords: Self-employment entrepreneurial persistence count data

Find related papers by JEL classification:
C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models
J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand

This paper has been announced in the following NEP Reports:

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. van Praag, C Mirjam, 2003. " Business Survival and Success of Young Small Business Owners," Small Business Economics, Springer, vol. 21(1), pages 1-17, August. [Downloadable!] (restricted)
    Other versions:
  2. Ghatak, Maitreesh & Morelli, Massimo & Sjostrom, Tomas, 2001. "Occupational Choice and Dynamic Incentives," Review of Economic Studies, Blackwell Publishing, vol. 68(4), pages 781-810, October.
  3. Taylor, Mark P, 2001. "Self-Employment and Windfall Gains in Britain: Evidence from Panel Data," Economica, London School of Economics and Political Science, vol. 68(272), pages 539-65, November. [Downloadable!] (restricted)
    Other versions:
  4. Evans, David S & Jovanovic, Boyan, 1989. "An Estimated Model of Entrepreneurial Choice under Liquidity Constraints," Journal of Political Economy, University of Chicago Press, vol. 97(4), pages 808-27, August. [Downloadable!] (restricted)
  5. Vuong, Quang H, 1989. "Likelihood Ratio Tests for Model Selection and Non-nested Hypotheses," Econometrica, Econometric Society, vol. 57(2), pages 307-33, March. [Downloadable!] (restricted)
  6. Jones, Andrew M, 1989. "A Double-Hurdle Model of Cigarette Consumption," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 4(1), pages 23-39, Jan.-Mar.. [Downloadable!] (restricted)
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This page was last updated on 2008-8-31.


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