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The impact of human capital on the early success of necessity versus opportunity-based entrepreneurs

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  • Rui Baptista
  • Murat Karaöz
  • Joana Mendonça

Abstract

This paper examines whether founders’ backgrounds influence new firm survival in the early years after startup, focusing, in particular, on the impact of unemployment-driven entrepreneurship. For entrepreneurs who left their previous employment to found a new firm, both general and specific human capital play a key role in enhancing early survival chances. However, various forms of human capital have little effect on early survival of unemployment-driven entrepreneurs, who rely mostly on previous entrepreneurial experience to persevere. Results suggest that pre-entry capabilities play an important role in the early success of opportunity-based entrepreneurs, but have little influence on the early success of necessity-based ones. Copyright Springer Science+Business Media New York 2014

Suggested Citation

  • Rui Baptista & Murat Karaöz & Joana Mendonça, 2014. "The impact of human capital on the early success of necessity versus opportunity-based entrepreneurs," Small Business Economics, Springer, vol. 42(4), pages 831-847, April.
    • Handle: RePEc:kap:sbusec:v:42:y:2014:i:4:p:831-847
    DOI: 10.1007/s11187-013-9502-z
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    More about this item

    Keywords

    Entrepreneur human capital; Pre-entry capabilities; New firm survival; Opportunity-based entrepreneurship; Necessity-based entrepreneurship; L26;
    All these keywords.

    JEL classification:

    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship

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