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
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MonographDOI
The Economics of Gender in Mexico : Work, Family, State, and Market
TL;DR: In this article, the authors examine gender differences in the Mexican economy, with a focus on the labor market, and examine gender issues over the course of the life cycle, beginning with education and child labor, continuing with adult urban and rural labor force participation, and concluding with the situation of elderly Mexican men and women.
Journal ArticleDOI
Homeownership, housing capital gains and self-employment
TL;DR: In this article, the authors measure the impact of individual-level housing capital gains on transitions into and out of self-employment and find that a 20% real increase in home value over a two-year period raises the likelihood of entry into self employment by roughly 1.5 percentage points; housing capital losses have little effect on exits.
Journal ArticleDOI
On the Determinants of Entrepreneurial Activity: Individual Characteristics, Economic Environment, and Social Norms
TL;DR: In this paper, the authors review the literature on the determinants of entrepreneurial activity and investigate to what extent differences in population, business environment and cultural values contribute to explaining differences in entrepreneurial activity across Swedish municipalities.
Posted Content
Entrepreneurial entry:which institutions matter?
TL;DR: In this paper, the authors explore the relationship between the individual decision to become an entrepreneur and the institutional context and find that the key institutional features that enhance entrepreneurial activity are indeed the rule of law and limits to the state sector.
ReportDOI
Leverage over the Life Cycle and Implications for Firm Growth and Shock Responsiveness
Emin Dinlersoz,Sebnem Kalemli-Ozcan,Sebnem Kalemli-Ozcan,Sebnem Kalemli-Ozcan,Henry R. Hyatt,Veronika Penciakova +5 more
TL;DR: In this paper, the authors study the leverage of U.S. firms over their life-cycles and the connection between firm leverage, firm growth, and aggregate shocks, and find that private firms, but not public ones, deleveraged during the Great Recession, and that this deleveraging is associated with a reduction in firm revenue and employment growth.
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.