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What are Entrepreneurs' Objectives When Starting a New Business?

  • Lionel Desiage

    (ERUDITE - Equipe de Recherche sur l'Utilisation des Données Individuelles Temporelles en Economie - Université Paris-Est Créteil Val-de-Marne (UPEC) : EA437 - Université Paris-Est Marne-la-Vallée (UPEMLV), TEPP - Travail, Emploi et Politiques Publiques - CNRS : FR3435 - Université Paris-Est Marne-la-Vallée (UPEMLV))

This paper studies entrepreneurs' objectives when starting a business and the impact of entrepreneurial and firm characteristics on these objectives. Entrepreneurship involves two behaviors that lead to define two types of entrepreneurs: those who start businesses to create and secure their own jobs (protection motive) and those who want to develop their firms in terms of investment and personnel (developing motive). Individuals of the first group are defined as self-protectors and the second as developers. We show that the compositions of the self-protectors group and the developers group are very similar and differ only in a few characteristics. People with a low degree and low start-up capital are in a greater proportion among self-protectors. We use a French new entrepreneur survey and probit models to identify the determinants of choosing self-protection or development. We find that people who start firms to create their own jobs are those who are the most discriminated against on the labor market and those who have no entrepreneurial network. People with low start-up capital are more likely to become self-protector. Developers are those who have the possibility to be developers.

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Paper provided by HAL in its series Working Papers with number halshs-00809716.

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Date of creation: May 2010
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Handle: RePEc:hal:wpaper:halshs-00809716
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  1. Simeon Djankov & Edward Miguel & Yingyi Qian & Gérard Roland & Ekaterina Zhuravskaya, 2005. "Who are Russia's Entrepreneurs?," Journal of the European Economic Association, MIT Press, vol. 3(2-3), pages 587-597, 04/05.
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  12. Eric Bartelsman & Stefano Scarpetta & Fabiano Schivardi, 2003. "Comparative Analysis of Firm Demographics and Survival: Micro-Level Evidence for the OECD Countries," OECD Economics Department Working Papers 348, OECD Publishing.
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  14. Yannick L’Horty & Antoine Goujard & Emmanuel Duguet, 2008. "Les inégalités territoriales d'accès à l'emploi : une exploration à partir de sources administratives exhaustives," Économie et Statistique, Programme National Persée, vol. 415(1), pages 17-44.
  15. Evans, David S & Jovanovic, Boyan, 1989. "An Estimated Model of Entrepreneurial Choice under Liquidity Constraints," Journal of Political Economy, University of Chicago Press, vol. 97(4), pages 808-27, August.
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