IDEAS home Printed from https://ideas.repec.org/p/osf/osfxxx/75tn8.html
   My bibliography  Save this paper

Endogeneity and Entrepreneurship Research

Author

Listed:
  • Anderson, Brian S

    (University of Missouri - Kansas City)

Abstract

In this paper, I discuss common endogeneity problems found in entrepreneurship research. I show how entrepreneurship researchers, particularly those working with observational data, typically face several specific endogeneity threats in a given study. I then show through a series of simulated of datasets instrument variable approaches that effectively address endogeneity in a variety of research designs. I discuss best-practice recommendations for integrating instrument variables into entrepreneurship research at the study design phase, and outline potential sources for instruments.

Suggested Citation

  • Anderson, Brian S, 2018. "Endogeneity and Entrepreneurship Research," OSF Preprints 75tn8, Center for Open Science.
  • Handle: RePEc:osf:osfxxx:75tn8
    DOI: 10.31219/osf.io/75tn8
    as

    Download full text from publisher

    File URL: https://osf.io/download/5ad4729483e3aa000edd34e0/
    Download Restriction: no

    File URL: https://libkey.io/10.31219/osf.io/75tn8?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Joshua D. Angrist & Alan B. Krueger, 2001. "Instrumental Variables and the Search for Identification: From Supply and Demand to Natural Experiments," Journal of Economic Perspectives, American Economic Association, vol. 15(4), pages 69-85, Fall.
    2. Hansen, Lars Peter, 1982. "Large Sample Properties of Generalized Method of Moments Estimators," Econometrica, Econometric Society, vol. 50(4), pages 1029-1054, July.
    3. Johan Wiklund & Dean A. Shepherd, 2011. "Where to from Here? EO-as-Experimentation, Failure, and Distribution of Outcomes," Entrepreneurship Theory and Practice, , vol. 35(5), pages 925-946, September.
    4. Philippe Jacquart & John Antonakis, 2015. "When does charisma matter for top-level leaders? Effect of attributional ambiguity," Post-Print hal-02313174, HAL.
    5. Klaus E Meyer & Arjen Witteloostuijn & Sjoerd Beugelsdijk, 2017. "What’s in a p? Reassessing best practices for conducting and reporting hypothesis-testing research," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 48(5), pages 535-551, July.
    6. Clougherty, Joseph A. & Duso, Tomaso & Muck, Johannes, 2016. "Correcting for Self-selection Based Endogeneity in Management Research: Review, Recommendations and Simulations," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 19, pages 286-347.
    7. Angrist, Joshua D, 2001. "Estimations of Limited Dependent Variable Models with Dummy Endogenous Regressors: Simple Strategies for Empirical Practice," Journal of Business & Economic Statistics, American Statistical Association, vol. 19(1), pages 2-16, January.
    8. Oriana Bandiera & Iwan Barankay & Imran Rasul, 2011. "Field Experiments with Firms," Journal of Economic Perspectives, American Economic Association, vol. 25(3), pages 63-82, Summer.
    9. John Antonakis & Samuel Bendahan & Philippe Jacquart & Rafael Lalive, 2010. "On making causal claims : A review and recommendations," Post-Print hal-02313119, HAL.
    10. Norris Krueger, 1993. "The Impact of Prior Entrepreneurial Exposure on Perceptions of New Venture Feasibility and Desirability," Entrepreneurship Theory and Practice, , vol. 18(1), pages 5-21, October.
    11. S. Trevis Certo & John R. Busenbark & Hyun‐soo Woo & Matthew Semadeni, 2016. "Sample selection bias and Heckman models in strategic management research," Strategic Management Journal, Wiley Blackwell, vol. 37(13), pages 2639-2657, December.
    12. Guilhem Bascle, 2008. "Controlling for endogeneity with instrumental variables in strategic management research," Post-Print hal-00576795, HAL.
    13. Yoshihiro Eshima & Brian S. Anderson, 2017. "Firm growth, adaptive capability, and entrepreneurial orientation," Strategic Management Journal, Wiley Blackwell, vol. 38(3), pages 770-779, March.
    14. J. Myles Shaver, 1998. "Accounting for Endogeneity When Assessing Strategy Performance: Does Entry Mode Choice Affect FDI Survival?," Management Science, INFORMS, vol. 44(4), pages 571-585, April.
    15. Ashish Arora & Michelle Gittelman & Sarah Kaplan & John Lynch & Will Mitchell & Nicolaj Siggelkow & Brent Goldfarb & Andrew A. King, 2016. "Scientific apophenia in strategic management research: Significance tests & mistaken inference," Strategic Management Journal, Wiley Blackwell, vol. 37(1), pages 167-176, January.
    16. Michael P. Murray, 2006. "Avoiding Invalid Instruments and Coping with Weak Instruments," Journal of Economic Perspectives, American Economic Association, vol. 20(4), pages 111-132, Fall.
    17. Jeffrey M Wooldridge, 2010. "Econometric Analysis of Cross Section and Panel Data," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262232588, December.
    18. Richard A. Bettis, 2012. "The search for asterisks: Compromised statistical tests and flawed theories," Strategic Management Journal, Wiley Blackwell, vol. 33(1), pages 108-113, January.
    19. Richard A. Bettis & Sendil Ethiraj & Alfonso Gambardella & Constance Helfat & Will Mitchell, 2016. "Creating repeatable cumulative knowledge in strategic management," Strategic Management Journal, Wiley Blackwell, vol. 37(2), pages 257-261, February.
    20. Andrews,Donald W. K. & Stock,James H. (ed.), 2005. "Identification and Inference for Econometric Models," Cambridge Books, Cambridge University Press, number 9780521844413.
    21. Philippe Jacquart & John Antonakis, 2015. "When does charisma matter for top-level leaders? Effect of attributional ambiguity," Post-Print hal-02276710, HAL.
    22. Todd A. Gormley & David A. Matsa, 2014. "Common Errors: How to (and Not to) Control for Unobserved Heterogeneity," The Review of Financial Studies, Society for Financial Studies, vol. 27(2), pages 617-661.
    23. Anderson, Brian S. & Eshima, Yoshihiro, 2013. "The influence of firm age and intangible resources on the relationship between entrepreneurial orientation and firm growth among Japanese SMEs," Journal of Business Venturing, Elsevier, vol. 28(3), pages 413-429.
    24. Donald B. Rubin, 2005. "Causal Inference Using Potential Outcomes: Design, Modeling, Decisions," Journal of the American Statistical Association, American Statistical Association, vol. 100, pages 322-331, March.
    25. repec:fth:prinin:455 is not listed on IDEAS
    26. Roundy, Philip T. & Brockman, Beverly K. & Bradshaw, Mike, 2017. "The resilience of entrepreneurial ecosystems," Journal of Business Venturing Insights, Elsevier, vol. 8(C), pages 99-104.
    27. Martin, Bruce C. & McNally, Jeffrey J. & Kay, Michael J., 2013. "Examining the formation of human capital in entrepreneurship: A meta-analysis of entrepreneurship education outcomes," Journal of Business Venturing, Elsevier, vol. 28(2), pages 211-224.
    28. Xinshu Zhao & John G. Lynch & Qimei Chen, 2010. "Reconsidering Baron and Kenny: Myths and Truths about Mediation Analysis," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 37(2), pages 197-206, August.
    29. Joshua Angrist & Alan Krueger, 2001. "Instrumental Variables and the Search for Identification: From Supply and Demand to Natural Experiments," Working Papers 834, Princeton University, Department of Economics, Industrial Relations Section..
    30. Kosuke Imai & Gary King & Elizabeth A. Stuart, 2008. "Misunderstandings between experimentalists and observationalists about causal inference," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 171(2), pages 481-502, April.
    31. Angrist, Joshua D, 2001. "Estimations of Limited Dependent Variable Models with Dummy Endogenous Regressors: Simple Strategies for Empirical Practice: Reply," Journal of Business & Economic Statistics, American Statistical Association, vol. 19(1), pages 27-28, January.
    32. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 58(2), pages 277-297.
    33. S. Trevis Certo & Michael C. Withers & Matthew Semadeni, 2017. "A tale of two effects: Using longitudinal data to compare within- and between-firm effects," Strategic Management Journal, Wiley Blackwell, vol. 38(7), pages 1536-1556, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Fultz, Andrew E.F. & Hmieleski, Keith M., 2021. "The art of discovering and exploiting unexpected opportunities: The roles of organizational improvisation and serendipity in new venture performance," Journal of Business Venturing, Elsevier, vol. 36(4).
    2. Covin, Jeffrey G. & Garrett, Robert P. & Kuratko, Donald F. & Shepherd, Dean A., 2020. "Short leash or long leash? Parenting style, initial strategic clarity, and the development of venture learning proficiency," Journal of Business Venturing, Elsevier, vol. 35(4).
    3. Cottle, Griffin W. & Anderson, Brian S., 2020. "The temptation of exaggeration: Exploring the line between preparedness and misrepresentation in entrepreneurial pitches," Journal of Business Venturing Insights, Elsevier, vol. 14(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Anderson, Brian S. & Wennberg, Karl & McMullen, Jeffery S., 2019. "Editorial: Enhancing quantitative theory-testing entrepreneurship research," Journal of Business Venturing, Elsevier, vol. 34(5), pages 1-1.
    2. Wennberg, Karl & Anderson, Brian S. & McMullen, Jeffrey, 2019. "2 Editorial: Enhancing Quantitative Theory-Testing Entrepreneurship Research," Ratio Working Papers 323, The Ratio Institute.
    3. Markku Maula & Wouter Stam, 2020. "Enhancing Rigor in Quantitative Entrepreneurship Research," Entrepreneurship Theory and Practice, , vol. 44(6), pages 1059-1090, November.
    4. Guilhem Bascle, 2008. "Controlling for endogeneity with instrumental variables in strategic management research," Post-Print hal-00576795, HAL.
    5. Masakure, Oliver, 2016. "The effect of employee loyalty on wages," Journal of Economic Psychology, Elsevier, vol. 56(C), pages 274-298.
    6. Klaus E Meyer & Arjen Witteloostuijn & Sjoerd Beugelsdijk, 2017. "What’s in a p? Reassessing best practices for conducting and reporting hypothesis-testing research," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 48(5), pages 535-551, July.
    7. Joan Costa-Font & Sergi Jiménez-Martín & Cristina Vilaplana-Prieto, 2016. "Thinking of Incentivizing Care? The Effect of Demand Subsidies on Informal Caregiving and Intergenerational Transfers," Working Papers 2016-08, FEDEA.
    8. Lahiri, Bidisha & Ali, Haider, 2022. "Inspections, informal payments and tax payments by firms," Finance Research Letters, Elsevier, vol. 46(PA).
    9. Hoang, Tuyen Thanh & Nguyen, Cuong Viet & Van Tran, Hoa Thi, 2019. "Are female CEOs more risk averse than male counterparts? Evidence from Vietnam," Economic Analysis and Policy, Elsevier, vol. 63(C), pages 57-74.
    10. Long Thanh Giang & Cuong Viet Nguyen & Tuyen Quang Tran & Vu Thieu, 2017. "Does Firm Agglomeration Matter to Labor and Education of Local Children? Evidence in Vietnam," Child Indicators Research, Springer;The International Society of Child Indicators (ISCI), vol. 10(4), pages 1015-1041, December.
    11. Christopher Kurzhals & Lorenz Graf‐Vlachy & Andreas König, 2020. "Strategic leadership and technological innovation: A comprehensive review and research agenda," Corporate Governance: An International Review, Wiley Blackwell, vol. 28(6), pages 437-464, November.
    12. Mathenge, Mary K. & Smale, Melinda & Olwande, John, 2014. "The impacts of hybrid maize seed on the welfare of farming households in Kenya," Food Policy, Elsevier, vol. 44(C), pages 262-271.
    13. Nguyen, Cuong, 2012. "Does Urbanization Help Poverty Reduction in Rural Areas?Evidence from a Developing Country," MPRA Paper 48660, University Library of Munich, Germany.
    14. Cuong Viet Nguyen & Thu Thi Le & Nguyen Hanh Nguyen, 2021. "The impact of cigarette prices on smoking participation and tobacco expenditure in Vietnam," PLOS ONE, Public Library of Science, vol. 16(12), pages 1-20, December.
    15. Clougherty, Joseph A. & Duso, Tomaso & Muck, Johannes, 2016. "Correcting for Self-selection Based Endogeneity in Management Research: Review, Recommendations and Simulations," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 19, pages 286-347.
    16. Cameron McIntosh, 2014. "The presence of an error term does not preclude causal inference in regression: a comment on Krause (2012)," Quality & Quantity: International Journal of Methodology, Springer, vol. 48(1), pages 243-250, January.
    17. Jubril Animashaun & Ada Wossink & Katsushi S. Imai, 2023. "Colonialism, Institutional Quality, and the Resource Curse," Discussion Paper Series DP2023-19, Research Institute for Economics & Business Administration, Kobe University.
    18. Ilona Babenko & Benjamin Bennett & John M Bizjak & Jeffrey L Coles & Jason J Sandvik, 2023. "Clawback Provisions and Firm Risk," The Review of Corporate Finance Studies, Society for Financial Studies, vol. 12(2), pages 191-239.
    19. Mathenge, Mary K. & Smale, Melinda & Olwande, John, 2012. "The Impact of Maize Hybrids on Income, Poverty, and Inequality among Smallholder Farmers in Kenya," Food Security International Development Working Papers 146931, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    20. Huang, Qianqian & Jiang, Feng & Lie, Erik & Yang, Ke, 2014. "The role of investment banker directors in M&A," Journal of Financial Economics, Elsevier, vol. 112(2), pages 269-286.

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:osf:osfxxx:75tn8. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: OSF (email available below). General contact details of provider: https://osf.io/preprints/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.