IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this paper

Business Experience and Start-up Size: Buying More Lottery Tickets Next Time Around?

Listed author(s):
  • Alex Coad

    (SPRU, University of Sussex)

  • Julian Frankish

    (Barclay’s Bank, UK)

  • Paul Nightingale

    (SPRU, University of Sussex)

  • Richard G. Roberts

    (Barclay’s Bank, UK)

  • David J. Storey

    (University of Sussex)

This paper explores the determinants of start-up size by focusing on a cohort of 6,247 businesses that started trading in 2004, using a unique dataset on customer records at Barclays Bank. Quantile regressions show that prior business experience is significantly related with start-up size, as are a number of other variables such as age, education and bank account activity. Quantile treatment effects (QTE) estimates show similar results, with the effect of business experience on (log) start-up size being roughly constant across the quantiles. Prior personal business experience leads to an increase in expected start-up size of about 50 %. Instrumental variable QTE estimates are even higher, although there are concerns about the validity of the instrument. Copyright Springer Science+Business Media New York 2014

(This abstract was borrowed from another version of this item.)

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.sussex.ac.uk/spru/documents/sewp203.pdf
Download Restriction: no

Paper provided by SPRU - Science and Technology Policy Research, University of Sussex in its series SPRU Working Paper Series with number 203.

as
in new window

Length: 26 pages
Date of creation: 10 Dec 2012
Handle: RePEc:sru:ssewps:203
Contact details of provider: Postal:
Jubilee Building G08, Falmer, Brighton, BN1 9SL

Phone: +44 (0)1273 686758
Fax: +44 (0)1273 685865
Web page: http://www.sussex.ac.uk/spru
Email:


More information through EDIRC

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Barrett, Alan & Kearney, Ide & O'Brien, Martin, 2007. "Quarterly Economic Commentary, Summer 2007," Forecasting Report, Economic and Social Research Institute (ESRI), number QEC20072, December.
  2. Zoltan J. Acs & Catherine Armington & Ting Zhang, 2007. "The determinants of new-firm survival across regional economies: The role of human capital stock and knowledge spillover," Papers in Regional Science, Wiley Blackwell, vol. 86(3), pages 367-391, 08.
  3. Douglas Staiger & James H. Stock, 1997. "Instrumental Variables Regression with Weak Instruments," Econometrica, Econometric Society, vol. 65(3), pages 557-586, May.
  4. Li, Hongyi & Wei, Xiangdong & Xie, Danyang, 2009. "Competitiveness of the Hong Kong economy," China Economic Review, Elsevier, vol. 20(3), pages 573-586, September.
  5. Angus Deaton, 2010. "Instruments, Randomization, and Learning about Development," Journal of Economic Literature, American Economic Association, vol. 48(2), pages 424-455, June.
  6. Barrett, Alan & Kearney, Ide & O'Brien, Martin, 2007. "Quarterly Economic Commentary, Winter 2007," Forecasting Report, Economic and Social Research Institute (ESRI), number QEC20074, December.
  7. Edwin Leuven & Barbara Sianesi, 2003. "PSMATCH2: Stata module to perform full Mahalanobis and propensity score matching, common support graphing, and covariate imbalance testing," Statistical Software Components S432001, Boston College Department of Economics, revised 19 Jan 2015.
  8. Robert W. Fairlie & Alicia M. Robb, 2007. "Why Are Black-Owned Businesses Less Successful than White-Owned Businesses? The Role of Families, Inheritances, and Business Human Capital," Journal of Labor Economics, University of Chicago Press, vol. 25, pages 289-323.
  9. Anonymous, 2007. "Minnesota Applied Economist 719, Summer 2007," Minnesota Applied Economist/Minnesota Agricultural Economist 8494, University of Minnesota, Department of Applied Economics.
  10. Barrett, Alan & Kearney, Ide & McCarthy, Yvonne, 2007. "Quarterly Economic Commentary, Spring 2007," Forecasting Report, Economic and Social Research Institute (ESRI), number QEC20071, December.
  11. Alberto Abadie & David Drukker & Jane Leber Herr & Guido W. Imbens, 2004. "Implementing matching estimators for average treatment effects in Stata," Stata Journal, StataCorp LP, vol. 4(3), pages 290-311, September.
  12. ,, 2009. "Economics of Monetary Union," OUP Catalogue, Oxford University Press, edition 8, number 9780199563234, December.
  13. Alberto Abadie & Joshua Angrist & Guido Imbens, 1999. "Instrumental Variables Estimates of the Effect of Subsidized Training on the Quantiles of Trainee Earnings," Working papers 99-16, Massachusetts Institute of Technology (MIT), Department of Economics.
  14. Barrett, Alan & Kearney, Ide & Goggin, Jean, 2009. "Quarterly Economic Commentary, Autumn 2009," Forecasting Report, Economic and Social Research Institute (ESRI), number QEC20093, December.
  15. Anonymous & Owen, Anthony D., 1994. "The Economics of Papua New Guinea's Tuna Fisheries," Monographs, Australian Centre for International Agricultural Research, number 119355.
  16. Oecd, 2009. "Gender and Economic Empowerment in Africa," OECD Journal: General Papers, OECD Publishing, vol. 2009(1), pages 87-126.
  17. Massimo G. Colombo & Silvia Giannangeli & Luca Grilli, 2013. "Public subsidies and the employment growth of high-tech start-ups: assessing the impact of selective and automatic support schemes," Industrial and Corporate Change, Oxford University Press, vol. 22(5), pages 1273-1314, October.
  18. Julian S. Frankish & Richard G. Roberts & Alex Coad & Taylor C. Spears & David J. Storey, 2013. "Do entrepreneurs really learn? Or do they just tell us that they do?," Industrial and Corporate Change, Oxford University Press, vol. 22(1), pages 73-106, February.
  19. Huifeng Li & Xiaofang Wang, 2010. "Study on Chinese Low Carbon Economic Model," International Journal of Asian Business and Information Management (IJABIM), IGI Global, vol. 1(4), pages 57-64, October.
  20. Nan Li & Ceyhun Bora Durdu & Emine Boz, 2010. "Labor Market Search in Emerging Economies," 2010 Meeting Papers 255, Society for Economic Dynamics.
  21. Da Rin, M. & Di Giacomo, M. & Sembenelli, A., 2010. "Corporate taxation and the size of new firms : Evidence from Europe," Other publications TiSEM 220989f9-77d5-4904-9a90-3, Tilburg University, School of Economics and Management.
  22. anonymous, 2012. "New St. Louis Fed banking and economic research," Central Banker, Federal Reserve Bank of St. Louis, issue Winter, pages -.
  23. Jovanovic, Boyan, 1982. "Selection and the Evolution of Industry," Econometrica, Econometric Society, vol. 50(3), pages 649-670, May.
  24. Cabral, Luís M B & Mata, José, 2001. "On the Evolution of the Firm Size Distribution: Facts and Theory," CEPR Discussion Papers 3045, C.E.P.R. Discussion Papers.
  25. Cooper, Arnold C. & Woo, Carolyn Y. & Dunkelberg, William C., 1989. "Entrepreneurship and the initial size of firms," Journal of Business Venturing, Elsevier, vol. 4(5), pages 317-332, September.
  26. Unknown, 1996. "Newsletter Spring 1996," Institute on Global Conflict and Cooperation, Working Paper Series qt0kg7492b, Institute on Global Conflict and Cooperation, University of California.
  27. Ma, Hengyun & Oxley, Les & Gibson, John & Li, Wen, 2010. "A survey of China's renewable energy economy," Renewable and Sustainable Energy Reviews, Elsevier, vol. 14(1), pages 438-445, January.
  28. Coad, Alex & Frankish, Julian & Roberts, Richard G. & Storey, David J., 2013. "Growth paths and survival chances: An application of Gambler's Ruin theory," Journal of Business Venturing, Elsevier, vol. 28(5), pages 615-632.
  29. Sergio Firpo, 2004. "Efficient Semiparametric Estimation of Quantile Treatment Effects," Econometric Society 2004 North American Summer Meetings 605, Econometric Society.
  30. Peter W. Roberts & Steven Klepper & Scott Hayward, 2011. "Founder backgrounds and the evolution of firm size," Industrial and Corporate Change, Oxford University Press, vol. 20(6), pages 1515-1538, December.
  31. Koenker,Roger, 2005. "Quantile Regression," Cambridge Books, Cambridge University Press, number 9780521845731, October.
  32. Hadhek Zouhaier & Kefi Mohamed Karim, 2012. "Democracy, Investment and Economic Growth," International Journal of Economics and Financial Issues, Econjournals, vol. 2(3), pages 233-240.
  33. Markus Frölich & Blaise Melly, 2007. "Unconditional quantile treatment effects under endogeneity," CeMMAP working papers CWP32/07, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
  34. Hadhek Zouhaier & Mohamed Karim KEFI, 2012. "Institutions and Economic Growth," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 2(7), pages 795-812, November.
  35. Joan-Lluis Capelleras & Durim Hoxha, 2010. "Start-up size and subsequent firm growth in Kosova: the role of entrepreneurial and institutional factors," Post-Communist Economies, Taylor & Francis Journals, vol. 22(3), pages 411-426.
  36. Yang, Z.F. & Jiang, M.M. & Chen, B. & Zhou, J.B. & Chen, G.Q. & Li, S.C., 2010. "Solar emergy evaluation for Chinese economy," Energy Policy, Elsevier, vol. 38(2), pages 875-886, February.
  37. MacLaren, Donald, 1994. "Economics, Agriculture and the Gatt," 1994 Conference (38th), February 8-10, 1994, Wellington, New Zealand 148472, Australian Agricultural and Resource Economics Society.
  38. Mohamed Karim KEFI & Hadhek Zouhaier, 2012. "Inequality and Economic Growth," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 2(8), pages 1013-1025, December.
  39. Bamford, Charles E. & Dean, Thomas J. & Douglas, Thomas J., 2004. "The temporal nature of growth determinants in new bank foundings: implications for new venture research design," Journal of Business Venturing, Elsevier, vol. 19(6), pages 899-919, November.
  40. Barrett, Alan & Kearney, Ide & Goggin, Jean, 2009. "Quarterly Economic Commentary, Spring 2009," Forecasting Report, Economic and Social Research Institute (ESRI), number QEC20091, December.
  41. Unknown, 1996. "Newsletter Fall 1996," Institute on Global Conflict and Cooperation, Working Paper Series qt9dp322p4, Institute on Global Conflict and Cooperation, University of California.
  42. Ongena, Steven & Smith, David C., 2000. "What Determines the Number of Bank Relationships? Cross-Country Evidence," Journal of Financial Intermediation, Elsevier, vol. 9(1), pages 26-56, January.
  43. Barrett, Alan & Kearney, Ide & Conefrey, Thomas & O'Sullivan, Cormac, 2010. "Quarterly Economic Commentary, Winter 2010," Forecasting Report, Economic and Social Research Institute (ESRI), number QEC20104, December.
  44. anonymous, 2010. "The economic importance of being educated," Forefront, Federal Reserve Bank of Cleveland, issue Fall, pages 6-9.
  45. Barrett, Alan & Kearney, Ide & Conefrey, Thomas & O'Sullivan, Cormac, 2010. "Quarterly Economic Commentary, Autumn 2010," Forecasting Report, Economic and Social Research Institute (ESRI), number QEC20103, December.
  46. Metzger, Georg, 2006. "Once bitten, twice shy? The performance of entrepreneurial restarts," ZEW Discussion Papers 06-83, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  47. UNEP & FAO & IMO & UNDP & IUCN & WorldFish Center & GRID-Arendal, 2012. "Green economy in a blue world: synthesis report," Working Papers, The WorldFish Center, number 39611, December.
  48. Mata, Jose & Portugal, Pedro & Guimaraes, Paulo, 1995. "The survival of new plants: Start-up conditions and post-entry evolution," International Journal of Industrial Organization, Elsevier, vol. 13(4), pages 459-481, December.
  49. anonymous, 2012. "Snapshot: Mexico's economic expansion slows," Southwest Economy, Federal Reserve Bank of Dallas, issue Q4, pages 1-20.
  50. William R. Kerr & Ramana Nanda, 2010. "Banking Deregulations, Financing Constraints, and Firm Entry Size," Journal of the European Economic Association, MIT Press, vol. 8(2-3), pages 582-593, 04-05.
  51. Robb Richard, 2009. "Nietzsche and the Economics of Becoming," Capitalism and Society, De Gruyter, vol. 4(1), pages 1-30, June.
  52. Geroski, P. A., 1995. "What do we know about entry?," International Journal of Industrial Organization, Elsevier, vol. 13(4), pages 421-440, December.
  53. Anonymous & Shang, Yung C. & Leung, PingSun, 1994. "Economics of Commercial Giant Clam Mariculture," Monographs, Australian Centre for International Agricultural Research, number 118691.
  54. Gorg, Holger & Strobl, Eric & Ruane, Frances, 2000. "Determinants of Firm Start-Up Size: An Application of Quantile Regression for Ireland," Small Business Economics, Springer, vol. 14(3), pages 211-222, May.
  55. Sourafel Girma & Holger Görg & Aoife Hanley & Eric Strobl, 2010. "The effect of grant receipt on start-up size: Evidence from plant level data," Journal of International Entrepreneurship, Springer, vol. 8(4), pages 371-391, December.
  56. Anonymous, 1994. "Summary of economic forecasts," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 57, pages -, March.
  57. Colombo, Massimo G. & Grilli, Luca, 2005. "Start-up size: The role of external financing," Economics Letters, Elsevier, vol. 88(2), pages 243-250, August.
  58. Colombo, Massimo G. & Delmastro, Marco & Grilli, Luca, 2004. "Entrepreneurs' human capital and the start-up size of new technology-based firms," International Journal of Industrial Organization, Elsevier, vol. 22(8-9), pages 1183-1211, November.
  59. Markus Frolich & Blaise Melly, 2010. "Estimation of quantile treatment effects with Stata," Stata Journal, StataCorp LP, vol. 10(3), pages 423-457, September.
  60. Barrett, Alan & Kearney, Ide & Goggin, Jean & Conefrey, Thomas, 2009. "Quarterly Economic Commentary, Winter 2009," Forecasting Report, Economic and Social Research Institute (ESRI), number QEC20094, December.
  61. repec:pri:rpdevs:deaton_instruments_randomization_learning_all_04april_2010 is not listed on IDEAS
  62. Laspita, Stavroula & Breugst, Nicola & Heblich, Stephan & Patzelt, Holger, 2012. "Intergenerational transmission of entrepreneurial intentions," Journal of Business Venturing, Elsevier, vol. 27(4), pages 414-435.
  63. Mata, Jose & Machado, Jose A. F., 1996. "Firm start-up size: A conditional quantile approach," European Economic Review, Elsevier, vol. 40(6), pages 1305-1323, June.
  64. Josep-Maria Arauzo-Carod & Agustí Segarra-Blasco, 2005. "The Determinants of Entry are not Independent of Start-up Size: Some Evidence from Spanish Manufacturing," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 27(2), pages 147-165, 09.
  65. Davidsson, Per & Honig, Benson, 2003. "The role of social and human capital among nascent entrepreneurs," Journal of Business Venturing, Elsevier, vol. 18(3), pages 301-331, May.
  66. A. Amaral & Rui Baptista & Francisco Lima, 2011. "Serial entrepreneurship: impact of human capital on time to re-entry," Small Business Economics, Springer, vol. 37(1), pages 1-21, July.
  67. "Okada, Akira", 2010. "Toshiji Kawagoe, Experimental Economics," Economic Review, Hitotsubashi University, vol. 61(1), pages 85-87, January.
  68. Marcelo Resende, 2007. "Determinants of firm start-up size in the Brazilian industry: an empirical investigation," Applied Economics, Taylor & Francis Journals, vol. 39(8), pages 1053-1058.
  69. Mata, Jose, 1996. "Markets, entrepreneurs and the size of new firms," Economics Letters, Elsevier, vol. 52(1), pages 89-94, July.
  70. Almus, Matthias & Nerlinger, Eric A, 1999. "Growth of New Technology-Based Firms: Which Factors Matter?," Small Business Economics, Springer, vol. 13(2), pages 141-154, September.
  71. P.A. Geroski & José Mata & Pedro Portugal, 2003. "Founding Conditions and the Survival of New Firms," Working Papers w200301, Banco de Portugal, Economics and Research Department.
  72. Ray Fair, 2009. "Analyzing Macroeconomic Forecastability," Yale School of Management Working Papers amz2443, Yale School of Management, revised 01 Oct 2009.
  73. anonymous, 2009. "Fed Gov. Duke: Economy's effects on banks vary," Financial Update, Federal Reserve Bank of Atlanta, pages -.
  74. Mark D. Partridge & Dan S. Rickman & Hui Li, 2009. "Who Wins From Local Economic Development?," Economic Development Quarterly, W.E. Upjohn Institute for Employment Research, vol. 23(1), pages 13-27, February.
  75. Thomas Åstbro & Irwin Bernhardt, 2005. "The Winner’s Curse of Human Capital," Small Business Economics, Springer, vol. 24(1), pages 63-78, February.
  76. Mathew L. A. Hayward & Dean A. Shepherd & Dale Griffin, 2006. "A Hubris Theory of Entrepreneurship," Management Science, INFORMS, vol. 52(2), pages 160-172, February.
  77. Bruno Cassiman & Reinhilde Veugelers, 2002. "R&D Cooperation and Spillovers: Some Empirical Evidence from Belgium," American Economic Review, American Economic Association, vol. 92(4), pages 1169-1184, September.
  78. AfDB AfDB, . "African Statistical Journal Vol. 9," African Statistical Journal, African Development Bank, number 57 edited by Koua Louis Kouakou.
  79. Hans K. Hvide & Jarle Møen, 2010. "Lean and Hungry or Fat and Content? Entrepreneurs' Wealth and Start-Up Performance," Management Science, INFORMS, vol. 56(8), pages 1242-1258, August.
  80. Agarwal, Rajshree & Audretsch, David B, 2001. "Does Entry Size Matter? The Impact of the Life Cycle and Technology on Firm Survival," Journal of Industrial Economics, Wiley Blackwell, vol. 49(1), pages 21-43, March.
  81. Audretsch, David B. & Santarelli, Enrico & Vivarelli, Marco, 1999. "Start-up size and industrial dynamics: some evidence from Italian manufacturing," International Journal of Industrial Organization, Elsevier, vol. 17(7), pages 965-983, October.
  82. Barrett, Alan & Kearney, Ide & Goggin, Jean & Conefrey, Thomas, 2010. "Quarterly Economic Commentary, Summer 2010," Forecasting Report, Economic and Social Research Institute (ESRI), number QEC20102, December.
  83. Cressy, Robert, 1996. "Are Business Startups Debt-Rationed?," Economic Journal, Royal Economic Society, vol. 106(438), pages 1253-1270, September.
  84. Liyan Han & Donghui Li & Fariborz Moshirian & Yanhui Tian, 2010. "Insurance Development and Economic Growth*," The Geneva Papers on Risk and Insurance - Issues and Practice, Palgrave Macmillan;The Geneva Association, vol. 35(2), pages 183-199, April.
  85. anonymous, 2007. "Domestic prices in an integrated world economy," Proceedings, Board of Governors of the Federal Reserve System (U.S.), pages -.
  86. Anonymous, 1994. "Contents of Agricultural Economics, Vol. 10," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 10(3), pages -, May.
  87. Michael S. Dahl & Olav Sorenson, 2012. "Home Sweet Home: Entrepreneurs' Location Choices and the Performance of Their Ventures," Management Science, INFORMS, vol. 58(6), pages 1059-1071, June.
  88. Barrett, Alan & Kearney, Ide & Goggin, Jean & Conefrey, Thomas, 2010. "Quarterly Economic Commentary, Spring 2010," Forecasting Report, Economic and Social Research Institute (ESRI), number QEC20101, December.
  89. Oosterbeek, Hessel & van Praag, Mirjam & Ijsselstein, Auke, 2010. "The impact of entrepreneurship education on entrepreneurship skills and motivation," European Economic Review, Elsevier, vol. 54(3), pages 442-454, April.
  90. Anonymous, 2007. "Minnesota Applied Economist 720," Minnesota Applied Economist/Minnesota Agricultural Economist 7562, University of Minnesota, Department of Applied Economics.
  91. Barrett, Alan & Kearney, Ide & Goggin, Jean, 2009. "Quarterly Economic Commentary, Summer 2009," Forecasting Report, Economic and Social Research Institute (ESRI), number QEC20092, December.
  92. Satu Nurmi, 2006. "Sectoral Differences in Plant Start-up Size in the Finnish Economy," Small Business Economics, Springer, vol. 26(1), pages 39-60, 02.
  93. anonymous, 2007. "Border metros see economic growth," Crossroads, Federal Reserve Bank of Dallas, pages -.
  94. Pernilla Andersson, 2007. "Do the unemployed become successful entrepreneurs?," International Journal of Manpower, Emerald Group Publishing, vol. 28(7), pages 604-626, October.
  95. anonymous, 1996. "Recission of staff interpretative letter," Federal Reserve Bulletin, Board of Governors of the Federal Reserve System (U.S.), issue Oct, pages 907-908.
  96. Barrett, Alan & Kearney, Ide & O'Brien, Martin, 2007. "Quarterly Economic Commentary, Autumn 2007," Forecasting Report, Economic and Social Research Institute (ESRI), number QEC20073, December.
  97. Alicia Robb & Robert Fairlie, 2009. "Determinants of business success: an examination of Asian-owned businesses in the USA," Journal of Population Economics, Springer;European Society for Population Economics, vol. 22(4), pages 827-858, October.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:sru:ssewps:203. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Russell Eke)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.