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How do Entrepreneurial Bosses influence their Employees' Future Entrepreneurship Choices?

Listed author(s):
  • Vera Rocha

    (Copenhagen Business School, Denmark)

  • Mirjam van Praag

    (Copenhagen Business School, Faculty of Economics and Business, University of Amsterdam and Tinbergen Institute, The Netherlands)

We adopt a process-based approach to investigate the influence of entrepreneurial bosses on the two main decisions of employees towards becoming entrepreneurs: exit from the current firm and entry into entrepreneurship. In other words, we study the push and pull mechanisms possibly underlying the influence of entrepreneurial bosses. We do so by employing an identification strategy based on comparisons of same-gender matches of bosses and employees, using rich register data for Denmark. We show that same-gender entrepreneurial bosses have a great impact on employees’ future entrepreneurship choices, especially among women. We do not find any evidence that female bosses push female employees out of the workplace, by creating a discriminatory environment that forces them to search for alternative career paths. Instead, our analysis finds consistent support for pull mechanisms, with role modeling being the main explanation for the positive influence of female entrepreneurial bosses on female employees’ transition into entrepreneurship. We show that the female boss effect is greater than other social interactions identified in prior research. We conclude that entrepreneurial bosses can be role models and female entrepreneurial bosses may thus act as a lever to reducing gender gaps in entrepreneurship rates.

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Paper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 16-110/VII.

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Date of creation: 16 Dec 2016
Handle: RePEc:tin:wpaper:20160110
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