Entrepreneurial human capital
We argue that formal schooling and wage-work experience are complementary types of human capital for entrepreneurs. Strong empirical support is found for this hypothesis as the interaction term between schooling and actual wage-work experience enters positively and significantly in a Mincer equation, whereas the effect of schooling in the absence of wage-work experience is insignificant. These results are extremely robust towards more flexible specifications, including fixed-effects estimations dealing with unobserved heterogeneity. For wage workers, the interaction term is negligible, confirming that the complementarity is a distinct characteristic of entrepreneurial human capital.
|Date of creation:||24 Apr 2009|
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