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Does Academic Entrepreneurship Pay?

  • Braunerhjelm, Pontus

    ()

    (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology)

  • Broström, Anders

    ()

    (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology)

  • Åstebro, Thomas

    (Department of Strategy HEC Paris)

Various policies have been devised to stimulate the creation of spin-offs from universities by academics. But we still do not know whether it is privately beneficial for academics to start new businesses. To address this question we compile total earnings for the universe of 478 individuals aged 60 or less working at Swedish universities who quit to become full-time entrepreneurs between 1999 and 2008. Using tax filings we record all possible earnings including wages, business income, dividends and capital gains. There are very few full-time academic entrepreneurs. Earnings are similar before and after becoming an entrepreneur and dividends and capital gains are inconsequential. But the income risk is more than three times higher in entrepreneurship. Entrepreneurship for academics appears a gradual process and quite episodic. Little explains entrepreneurial earnings except prior wage and forming a sole proprietorship.

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Paper provided by Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies in its series Working Paper Series in Economics and Institutions of Innovation with number 289.

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Length: 47 pages
Date of creation: 23 Nov 2012
Date of revision:
Handle: RePEc:hhs:cesisp:0289
Contact details of provider: Postal: CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology, SE-100 44 Stockholm, Sweden
Phone: +46 8 790 95 63
Web page: http://www.infra.kth.se/cesis/
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