Necessity and Opportunity Entrepreneurs and their Duration in Self-employment: Evidence from German Micro Data

Using data from the German Socio-Economic Panel Study (GSOEP), we analyze whether necessity entrepreneurs differ from opportunity entrepreneurs in terms of self-employment duration. Using univariate statistics, we find that opportunity entrepreneurs remain in self-employment longer than necessity entrepreneurs. However, after controlling for the entrepreneurs’ education in the professional area where they start their venture, this effect is no longer significant. We therefore conclude that the difference observed is not an original effect but rather is due to selection. We then go on to discuss the implications of our findings for entrepreneurship-policy making, and give suggestions to improve governmental start-up programs

Are Education and Entrepreneurial Income Endogenous and Do Family Background Variables Make Sense as Instruments?: A Bayesian Analysis

Education is a well-known driver of (entrepreneurial) income. The measurement of its influence, however, suffers from endogeneity suspicion. For instance, ability and occupational choice are mentioned as driving both the level of (entrepreneurial) income and of education. Using instrumental variables can provide a way out. However, three questions remain: whether endogeneity is really present, whether it matters and whether the selected instruments make sense. Using Bayesian methods, we find that the relationship between education and entrepreneurial income is indeed endogenous and that the impact of endogeneity on the estimated relationship between education and income is sizeable. We do so using family background variables and show that relaxing the strict validity assumption of these instruments does not lead to strongly different results. This is an important finding because family background variables are generally strongly correlated with education and are available in most datasets. Our approach is applicable beyond the field of returns to education for income. It applies wherever endogeneity suspicion arises and the three questions become relevant.Education, income, entrepreneurship, self-employment, endogeneity, instrumental variables, Bayesian analysis, family background variables

Determinanten des Erfolgs staatlich geförderter Existenzgründungen – eine empirische Untersuchung

Ein Großteil der Neugründungen in Deutschland ist auf staatliche Förderung von Existenzgründern zurückzuführen. Dieser Anteil hat sich nach Einführung des als „Ich-AG“ bekannten Existenzgründungszuschusses Anfang 2003 stark erhöht. Die Erfolgsfaktorenforschung hat diese Form von Gründungen bislang jedoch wenig untersucht. Im Rahmen einer großzahligen Befragung von geförderten Existenzgründern untersucht dieser Beitrag die Erfolgsdeterminanten solcher geförderter Existenzgründungen. Die Ergebnisse der Analyse zeigen, dass der Gewinn aus der Existenzgründung bei älteren Gründern und bei Gründern mit einer langen Phase der Arbeitslosigkeit vor der Gründung seltener beziehungsweise erst später zur Bestreitung des Lebensunterhalts ausreicht. Dies gilt auch für Franchisegründungen und für Gründungen durch Frauen. In Bezug auf Bildungsvariablen, Gründungserfahrung und Teamgründungen im Vergleich zu Einzelgründungen wurde kein Effekt gefunden. Vorhandene Branchenerfahrung wirkt sich hingegen positiv auf den Erfolg der Gründung aus, Gründungs- und Führungserfahrung dagegen nicht. Die Implikationen unserer Ergebnisse für die Entrepreneurship-Forschung sowie für die Entrepreneurship-Praxis werden diskutiert. Herausforderungen aus Sicht der Gründungspolitik werden aufgezeigt.A large number of new ventures in Germany are undertaken due to government aid. With the introduction of the “Ich-AG” or “me-plc” in January 2003, this share has increased strongly. Entrepreneurship research so far has said very little about the success and the determinants of success of these types of start-ups. With this study, we aim to close this gap. We analyze the success and the determinants of success of these new ventures in a large scale survey of founders that have received governmental aid for their start-up. Our results show that the income generated by the venture is less likely to cover the costs of living in particular for elderly founders and for those founders that have experienced a long period of unemployment before they started their venture. This finding is also true for new ventures founded by women as well as for franchise start-ups. As concerns formal education, founder experience, and the fact whether the venture is founded by a team or not no significant effects exist. Industry experience, however, has a significant positive effect on the success of the new venture whereas founding and management experience have no effect. We discuss the implications of our findings from a perspective of entrepreneurship research as well as from a perspective of governmental start-up policy

Determinanten des Erfolgs staatlich geförderter Existenzgründungen – eine empirische Untersuchung

Ein Großteil der Neugründungen in Deutschland ist auf staatliche Förderung von Existenzgründern zurückzuführen. Dieser Anteil hat sich nach Einführung des als „Ich-AG“ bekannten Existenzgründungszuschusses Anfang 2003 stark erhöht. Die Erfolgsfaktorenforschung hat diese Form von Gründungen bislang jedoch wenig untersucht. Im Rahmen einer großzahligen Befragung von geförderten Existenzgründern untersucht dieser Beitrag die Erfolgsdeterminanten solcher geförderter Existenzgründungen. Die Ergebnisse der Analyse zeigen, dass der Gewinn aus der Existenzgründung bei älteren Gründern und bei Gründern mit einer langen Phase der Arbeitslosigkeit vor der Gründung seltener beziehungsweise erst später zur Bestreitung des Lebensunterhalts ausreicht. Dies gilt auch für Franchisegründungen und für Gründungen durch Frauen. In Bezug auf Bildungsvariablen, Gründungserfahrung und Teamgründungen im Vergleich zu Einzelgründungen wurde kein Effekt gefunden. Vorhandene Branchenerfahrung wirkt sich hingegen positiv auf den Erfolg der Gründung aus, Gründungs- und Führungserfahrung dagegen nicht. Die Implikationen unserer Ergebnisse für die Entrepreneurship-Forschung sowie für die Entrepreneurship-Praxis werden diskutiert. Herausforderungen aus Sicht der Gründungspolitik werden aufgezeigt.A large number of new ventures in Germany are undertaken due to government aid. With the introduction of the “Ich-AG” or “me-plc” in January 2003, this share has increased strongly. Entrepreneurship research so far has said very little about the success and the determinants of success of these types of start-ups. With this study, we aim to close this gap. We analyze the success and the determinants of success of these new ventures in a large scale survey of founders that have received governmental aid for their start-up. Our results show that the income generated by the venture is less likely to cover the costs of living in particular for elderly founders and for those founders that have experienced a long period of unemployment before they started their venture. This finding is also true for new ventures founded by women as well as for franchise start-ups. As concerns formal education, founder experience, and the fact whether the venture is founded by a team or not no significant effects exist. Industry experience, however, has a significant positive effect on the success of the new venture whereas founding and management experience have no effect. We discuss the implications of our findings from a perspective of entrepreneurship research as well as from a perspective of governmental start-up policy.Entrepreneurship; Self-employment; Necessity Entreptreneurship; Entrepreneurship Policy; Determinants of Success

What Turns Knowledge into Innovative Products? The Role of Entrepreneurship and Knowledge Spillovers

The knowledge spillover theory of entrepreneurship seeks to explain the fundamentals and consequences of entrepreneurship with respect to economic performance. This paper uses the knowledge spillover theory to explain different innovation outcomes. We hypothesize that a high rate of entrepreneurship facilitates the process of turning knowledge into new-to-the-market innovation but has no effect on the relationship between knowledge and new-to-the-firm innovation. Our results using European country-level and pooled OLS, fixed- and random-effects regressions show that a high rate of entrepreneurship increases the chances that knowledge will become new-to-the-market innovation. The findings highlight the importance of Schumpeterian entrepreneurship in the process of the commercialization of knowledge. We discuss the implications for entrepreneurship and innovation policy

The association between attention-deficit/hyperactivity (ADHD) symptoms and self-employment

Attention-deficit/hyperactivity (ADHD) symptoms have been associated with the decision to become self-employed. Although these symptoms are generally regarded as disadvantageous, there may also be a bright side. To our knowledge, however, there has been no systematic, epidemiological evidence to support this claim. This paper examines the association between ADHD symptoms and self-employment in a population-based sample from the STAGE cohort of the Swedish Twin Registry (N = 7208). For replication, we used a sample of Dutch students who participated in the Global University Entrepreneurial Spirit Students’ Survey (N = 13,112). In the Swedish sample, we found a positive association with self-employment for both general ADHD symptoms [odds ratio (OR) 1.13; 95 % confidence intervals (CI) 1.04–1.23] and hyperactivity symptoms [OR 1.19; 95 % CI 1.08–1.32], whereas no association was found for attention-deficit symptoms [OR 0.99; 95 % CI 0.89–1.10]. The positive association between hyperactivity and self-employment was replicated in the Dutch student sample [OR 1.09; 95 % CI 1.03–1.15]. Our results show that certain aspects of ADHD, in particular hyperactivity, can have a bright side, as they are positively associated with self-employment

The impact of entrepreneurship research on other academic fields

The remarkable ascent of entrepreneurship witnessed as a scientific field over the last 4 decades has been made possible by entrepreneurship’s ability to absorb theories, paradigms, and methods from other fields such as economics, psychology, sociology, geography, and even biology. The respectability of entrepreneurship as an academic discipline is now evidenced by many other fields starting to borrow from the entrepreneurship view. In the present paper, seven examples are given from this “pay back” development. These examples were first presented during a seminar at the Erasmus Entrepreneurship Event called what has the entrepreneurship view to offer to other academic fields? This article elaborates on the core ideas of these presentations and focuses on the overarching question of how entrepreneurship research impacts the development of other academic fields. We found that entrepreneurship research questions the core assumptions of other academic fields and provides new insights into the antecedents, mechanisms, and consequences of their respective core phenomena. Moreover, entrepreneurship research helps to legitimize other academic fields both practically and academically.</p