Journal ArticleDOI
An Estimated Model of Entrepreneurial Choice under Liquidity Constraints
David S. Evans,Boyan Jovanovic +1 more
TLDR
The authors show that the data point to liquidity constraints: capital is essential for starting a business, and liquidity constraints tend to exclude those with insufficient funds at their disposal, and a would-be entrepreneur must bear most of the risk inherent in his venture.Abstract:
Is the capital function distinct from the entrepreneurial function in modern economies? Or does a person have to be wealthy before he or she can start a business? Knight and Schumpeter held different views on the answer to this question. Our empirical findings side with Knight: Liquidity constraints bind, and a would-be entrepreneur must bear most of the risk inherent in his venture. The reasoning is roughly this: The data show that wealthier people are more inclined to become entrepreneurs. In principle, this could be so because the wealthy tend to make better entrepreneurs, but the data reject this explanation. Instead, the data point to liquidity constraints: capital is essential for starting a business, and liquidity constraints tend to exclude those with insufficient funds at their disposal.read more
Citations
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Book ChapterDOI
Entrepreneurship in the Old and New Europe
TL;DR: In this article, the authors used 2004 survey data from the 25 EU member states and the US to explain country differences in entrepreneurial energy, measured by the probability of a declared preference for self-employment over employment.
Posted Content
The Transformation of Ownership Policy and Structure in Sweden: Convergence towards the Anglo-Saxon Model?
Magnus Henrekson,Ulf Jakobsson +1 more
TL;DR: In this paper, the authors investigate the dramatic transformation of ownership policies and ownership structure in Sweden during the postwar period and investigate whether this fast transformation is merely a logical consequence of current globalization, or whether this tendency has been reinforced by economic policies vis-a-vis the business sector in Sweden.
Journal ArticleDOI
The labour market consequences of self-employment spells: European evidence
Ari Hyytinen,Petri Rouvinen +1 more
TL;DR: This article examined how those re-entering paid-employment after a brief self-employment spell fare upon return using data from the European Community Household Panel, and found that those who reentered paid employment appear to have considerably lower wages than those staying in the wage sector.
Supporting High-tech Start-ups: Lessons from Italian Technology Policy
Massimo G. Colombo,Luca Grilli +1 more
TL;DR: In this paper, a review of the available national public subsidies, through empirical and econometric analyses, investigates whether horizontal general-purpose direct support mechanisms at national level permit an efficient allocation of public funds.
Posted Content
New Evidence on Self-Employment Transitions Among Older Americans with Career Jobs
TL;DR: In this article, the authors examined post-career self-employment transitions during the recent recession that began in late 2007 and during the ensuing lackluster recovery and found that self employment continues to be an important pathway to retirement even during recessionary times.
References
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Book
The theory of economic development
TL;DR: Buku ini memberikan infmasi tentang aliran melingkar kehidupan ekonomi sebagaimana dikondisikan oleh keadaan tertentu, fenomena fundamental dari pembangunan EKonomi, kredit, laba wirausaha, bunga atas modal, and siklus bisnis as mentioned in this paper.
Posted ContentDOI
Credit Rationing in Markets with Imperfect Information.
Joseph E. Stiglitz,Andrew Weiss +1 more
TL;DR: In this paper, a model is developed to provide the first theoretical justification for true credit rationing in a loan market, where the amount of the loan and amount of collateral demanded affect the behavior and distribution of borrowers, and interest rates serve as screening devices for evaluating risk.
Book
Risk, Uncertainty and Profit
TL;DR: In Risk, Uncertainty and Profit, Frank Knight explored the riddle of profitability in a competitive market profit should not be possible under competitive conditions, as the entry of new entrepreneurs would drive prices down and nullify margins, however evidence abounds of competitive yet profitable markets as mentioned in this paper.
Journal ArticleDOI
The theory of economic development
Posted Content
Competition and Entrepreneurship
TL;DR: Kirzner as discussed by the authors argues that the assumption of perfect knowledge is unrealistic and argues that every market participant is a potential entrepreneur who can exploit a situation, which depends on a lack of perfect information among the market participants.