Entrepreneurial School Dropouts: A Model on Signalling, Education and Entrepreneurship
I present a theory on the relationship between educational choice and entrepreneurship in a labour market with asymmetric information. The model shows that, in a labour market where education is used as a signalling device, an imperfect relationship between productivity in education and in the labour market can lead to an equilibrium where a fraction of the high-ability individuals choose to quit school and become entrepreneurs. Using a comprehensive set of Norwegian register data, I find that this is prediction is confirmed empirically: Individuals combining low education with high ability have the highest entrepreneurship rates in the population.
|Date of creation:||02 Apr 2012|
|Contact details of provider:|| Postal: Department of Economics, University of Oslo, P.O Box 1095 Blindern, N-0317 Oslo, Norway|
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Fax: 22 85 50 35
Web page: http://www.oekonomi.uio.no/indexe.html
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- Sandra E. Black & Paul J. Devereux & Kjell G. Salvanes, 2010.
"Small Family, Smart Family? Family Size and the IQ Scores of Young Men,"
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University of Wisconsin Press, vol. 45(1).
- Black, Sandra & Devereux, Paul J. & Salvanes, Kjell G, 2007. "Small Family, Smart Family? Family Size and the IQ Scores of Young Men," CEPR Discussion Papers 6443, C.E.P.R. Discussion Papers.
- Black, Sandra E. & Devereux, Paul J. & Salvanes, Kjell G., 2007. "Small Family, Smart Family? Family Size and the IQ Scores of Young Men," IZA Discussion Papers 3011, Institute for the Study of Labor (IZA).
- Paul J. Devereux & Sandra E. Black & Kjell G. Salvanes, 2007. "Small family, smart family? Family size and the IQ scores of young men," Open Access publications 10197/739, School of Economics, University College Dublin.
- Sandra E. Black & Paul J. Devereux & Kjell G. Salvanes, 2007. "Small Family, Smart Family? Family Size and the IQ Scores of Young Men," NBER Working Papers 13336, National Bureau of Economic Research, Inc.
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- 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. Full references (including those not matched with items on IDEAS)
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