Ability or Finances as Constraints on Entrepreneurship? Evidence from Survival Rates in a Natural Experiment

Publikation: Working paperForskning

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Abstrakt

We use a natural experiment in Denmark to test the hypothesis that aspiring entrepreneurs face financial constraints because of low entrepreneurial quality. We identify 304 constrained entrepreneurs who start a business after receiving windfall wealth and examine the performance of these marginal entrepreneurs. We find that constrained entrepreneurs have significantly lower survival rates and lower profits when compared with a matched sample of unconstrained entrepreneurs. These results are consistent with the hypothesis that the marginal entrepreneur is of low quality.
OriginalsprogEngelsk
Udgivelses stedFrederiksberg
UdgiverDepartment of Economics. Copenhagen Business School
Antal sider43
StatusUdgivet - 2012
NavnWorking Paper / Department of Economics. Copenhagen Business School
Nummer3-2012

Citationsformater

Andersen, S., & Meisner Nielsen, K. (2012). Ability or Finances as Constraints on Entrepreneurship? Evidence from Survival Rates in a Natural Experiment. Department of Economics. Copenhagen Business School. Working Paper / Department of Economics. Copenhagen Business School, Nr. 3-2012