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Spouses, Children, And Entrepreneurship

Author

Listed:
  • João Galindo da Fonseca
  • Charles Berubé

Abstract

We study the relationship between family and entrepreneurship decisions. Family influences entrepreneurship decisions via two channels: (i) Spouses work more in case of business failure and (ii) children increase the cost of failure. We use administrative matched owner–employer–employee–spouse data to estimate the predictions derived from our model. We find evidence that marriage decreases entry into entrepreneurship and increases average firm size, consistent with mechanism (ii) dominating the (i). Using direct information on children, we find that more children decrease entry into entrepreneurship and increase average firm size.

Suggested Citation

  • João Galindo da Fonseca & Charles Berubé, 2023. "Spouses, Children, And Entrepreneurship," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 64(3), pages 1165-1199, August.
    • Handle: RePEc:wly:iecrev:v:64:y:2023:i:3:p:1165-1199
    DOI: 10.1111/iere.12626
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    References listed on IDEAS

    as
    1. Joao Galindo da Fonseca, 2022. "Unemployment, Entrepreneurship and Firm Outcomes," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 45, pages 322-338, July.
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