Parenthood and Entrepreneurship Dynamics

We study the decisions to enter and persist in entrepreneurship, which we consider to be shaped by and intertwined with the transition into parenthood. By considering how motherhood and fatherhood influence values and acknowledging that the biological gender of newborns potentially impacts the likelihood of inter-generational firm transfer, we focus on individuals’ entrepreneurial dynamics. First,
we confirm that parenthood is associated with both entrepreneurial entry and persistence. Second, we exploit the randomness in the biological gender of newborns and we find that parenting sons is more strongly associated to the decision to enter entrepreneurship, but only for fathers. Also, mothers are more likely to leave entrepreneurship after the birth of their child(ren), while fathers are more likely to persist. Our results confirm the importance of considering the embeddedness of the family and show that the decision to become parent has repercussions on entrepreneurial dynamics.