Serial entrepreneurship, learning by doing and self-selection
AbstractIt remains a question whether serial entrepreneurs typically perform better than their novice counterparts owing to learning by doing e¤ects or mostly because they are a selected sample of higher-than-average ability entrepreneurs. This paper tries to unravel these two effects by exploring a novel empirical strategy based on continuous time duration models with selection. We use a large longitudinal matched employer-employee dataset that allows us to track almost 220,000 individuals who have left their first entrepreneurial experience. Over 35,000 serial entrepreneurs are identified and followed in their second business, in order to evaluate how entrepreneurial experience acquired in the previous business improves persistence by reducing their exit rates. Our results show that serial entrepreneurs are not a random selection of ex-business-owners. The positive association found between prior experience and serial entrepreneurs' survival is mainly due to selection on ability, rather than the result of learning by doing.
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Bibliographic InfoPaper provided by Universidade do Porto, Faculdade de Economia do Porto in its series CEF.UP Working Papers with number 1312.
Length: 29 pages
Date of creation: Jul 2013
Date of revision:
Serial Entrepreneurship; Entrepreneurial Experience; Learning; Selection;
Find related papers by JEL classification:
- D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search, Learning, and Information
- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
- L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-07-20 (All new papers)
- NEP-CSE-2013-07-20 (Economics of Strategic Management)
- NEP-ENT-2013-07-20 (Entrepreneurship)
- NEP-SBM-2013-07-20 (Small Business Management)
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