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Identity and Entrepreneurship

  • Oliver Falck
  • Stephan Heblich
  • Elke Lüdemann

We incorporate the concept of social identity into a stylized model of occupational choice and analyze whether an individual’s identity affects his or her decision to become an entrepreneur. We argue that an entrepreneurial identity results from an individual’s socialization. This could be parental influence but, as argued in this paper, also peer influence. To test this empirically, we apply instrumental variable approaches to PISA data. Our findings suggest that having an entrepreneurial peer group has a positive effect on an individual’s entrepreneurial intentions. Regarding entrepreneurial parents, we find a positive effect that cannot only be explained by ownership succession of the family business.

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File URL: http://www.cesifo-group.de/portal/page/portal/DocBase_Content/WP/WP-CESifo_Working_Papers/wp-cesifo-2009/wp-cesifo-2009-05/cesifo1_wp2661.pdf
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Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 2661.

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Date of creation: 2009
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Handle: RePEc:ces:ceswps:_2661
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  1. Douglas Holtz-Eakin & David Joulfaian & Harvey S. Rosen, 1993. "Sticking it Out: Entrepreneurial Survival and Liquidity Constraints," NBER Working Papers 4494, National Bureau of Economic Research, Inc.
  2. Aghion, Philippe & Howitt, Peter, 1992. "A Model of Growth Through Creative Destruction," Scholarly Articles 12490578, Harvard University Department of Economics.
  3. Wooldridge, Jeffrey M., 2001. "Asymptotic Properties Of Weighted M-Estimators For Standard Stratified Samples," Econometric Theory, Cambridge University Press, vol. 17(02), pages 451-470, April.
  4. Hessel Oosterbeek & Mirjam van Praag & Auke IJsselstein, 2008. "The impact of entrepreneurship education on entrepreneurship competencies and intentions: An evaluation of the Junior Achievement Student Mini-Company Program," Jena Economic Research Papers 2008-027, Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics.
  5. George A. Akerlof & Rachel E. Kranton, 2005. "Identity and the Economics of Organizations," Journal of Economic Perspectives, American Economic Association, vol. 19(1), pages 9-32, Winter.
  6. Michelacci, Claudio & Silva, Olmo, 2006. "Why So Many Local Entrepreneurs?," CEPR Discussion Papers 5828, C.E.P.R. Discussion Papers.
  7. Stefan Bauernschuster & Oliver Falck & Stephan Heblich, 2008. "Occupational Choice and Social Contacts Across Regions," Jena Economic Research Papers 2008-079, Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics.
  8. Michael Hout & Harvey Rosen, 2000. "Self-Employment, Family Background, and Race," Journal of Human Resources, University of Wisconsin Press, vol. 35(4), pages 670-692.
  9. Thomas Fuchs & Ludger Woessmann, 2004. "What Accounts for International Differences in Student Performance? A Re-examination using PISA Data," Econometric Society 2004 Australasian Meetings 274, Econometric Society.
  10. Nicole Schneeweis & Rudolf Winter-Ebmer, 2005. "Peer effects in Austrian schools," Economics working papers 2005-02, Department of Economics, Johannes Kepler University Linz, Austria.
  11. Aghion, P. & Howitt, P., 1989. "A Model Of Growth Through Creative Destruction," UWO Department of Economics Working Papers 8904, University of Western Ontario, Department of Economics.
  12. Cunha, Flavio & Heckman, James J., 2007. "The Technology of Skill Formation," IZA Discussion Papers 2550, Institute for the Study of Labor (IZA).
  13. Bernard F. Lentz & David N. Laband, 1990. "Entrepreneurial Success and Occupational Inheritance among Proprietors," Canadian Journal of Economics, Canadian Economics Association, vol. 23(3), pages 563-79, August.
  14. Feldman, Maryann P, 2001. "The Entrepreneurial Event Revisited: Firm Formation in a Regional Context," Industrial and Corporate Change, Oxford University Press, vol. 10(4), pages 861-91, December.
  15. Becker, Gary S, 1991. "A Note on Restaurant Pricing and Other Examples of Social Influences on Price," Journal of Political Economy, University of Chicago Press, vol. 99(5), pages 1109-16, October.
  16. Alejandro Gaviria & Steven Raphael, 2001. "School-Based Peer Effects And Juvenile Behavior," The Review of Economics and Statistics, MIT Press, vol. 83(2), pages 257-268, May.
  17. Solon, Gary, 1999. "Intergenerational mobility in the labor market," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 29, pages 1761-1800 Elsevier.
  18. Brian Wu & Anne Marie Knott, 2006. "Entrepreneurial Risk and Market Entry," Management Science, INFORMS, vol. 52(9), pages 1315-1330, September.
  19. Trogdon, Justin G. & Nonnemaker, James & Pais, Joanne, 2008. "Peer effects in adolescent overweight," Journal of Health Economics, Elsevier, vol. 27(5), pages 1388-1399, September.
  20. George A. Akerlof, 1997. "Social Distance and Social Decisions," Econometrica, Econometric Society, vol. 65(5), pages 1005-1028, September.
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  23. Kahneman, Daniel & Tversky, Amos, 1979. "Prospect Theory: An Analysis of Decision under Risk," Econometrica, Econometric Society, vol. 47(2), pages 263-91, March.
  24. Edward C. Norton & Richard C. Lindrooth & Susan T. Ennett, 1998. "Controlling for the endogeneity of peer substance use on adolescent alcohol and tobacco use," Health Economics, John Wiley & Sons, Ltd., vol. 7(5), pages 439-453.
  25. Becker, Gary S & Murphy, Kevin M, 1993. "A Simple Theory of Advertising as a Good or Bad," The Quarterly Journal of Economics, MIT Press, vol. 108(4), pages 941-64, November.
  26. Moulton, Brent R., 1986. "Random group effects and the precision of regression estimates," Journal of Econometrics, Elsevier, vol. 32(3), pages 385-397, August.
  27. Barton H. Hamilton, 2000. "Does Entrepreneurship Pay? An Empirical Analysis of the Returns to Self-Employment," Journal of Political Economy, University of Chicago Press, vol. 108(3), pages 604-631, June.
  28. George A. Akerlof & Rachel E. Kranton, 2000. "Economics And Identity," The Quarterly Journal of Economics, MIT Press, vol. 115(3), pages 715-753, August.
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