Arbeitspapier

If you are so smart, why aren't you an Entrepreneur?

How valuable are cognitive and social abilities for entrepreneurs’ incomes as compared to employees? We answer three questions: (1) To what extent does a composite measure of ability affect an entrepreneur's earnings relative to employees? (2) Do different cognitive abilities (e.g. math ability, language ability) and social ability affect earnings of entrepreneurs and employees differently?, and (3) Does the balance in these measured ability levels affect an individual's earnings? Our individual fixed-effects estimates of the differential returns to ability for spells in entrepreneurship versus wage employment account for selectivity into entrepreneurial positions as determined by fixed individual characteristics. General ability has a stronger impact on entrepreneurial incomes than on wages. Entrepreneurs and employees benefit from different sets of specific abilities: Language and clerical abilities have a stronger impact on wages, whereas mathematical, social and technical ability affect entrepreneurial incomes more strongly. The balance in the various kinds of ability also generates a higher income, but only for entrepreneurs: This finding supports Lazear's Jack-of-all-Trades theory.

Sprache
Englisch

Erschienen in
Series: Tinbergen Institute Discussion Paper ; No. 08-073/3

Klassifikation
Wirtschaft
Labor Demand
Human Capital; Skills; Occupational Choice; Labor Productivity
Wage Level and Structure; Wage Differentials
Professional Labor Markets; Occupational Licensing
New Firms; Startups
Thema
(Non-)Cognitive abilities
intelligence
earnings
entrepreneur(ship)
wage employment
income differentials
Berufswahl
Entrepreneurship-Ansatz
Arbeitskräfte
Soziale Kompetenz
Kognition
Erwerbsverlauf
Einkommen
USA

Ereignis
Geistige Schöpfung
(wer)
Hartog, Joop
van Praag, Mirjam
van der Sluis, Justin
Ereignis
Veröffentlichung
(wer)
Tinbergen Institute
(wo)
Amsterdam and Rotterdam
(wann)
2008

Handle
Letzte Aktualisierung
10.03.2025, 11:44 MEZ

Datenpartner

Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.

Objekttyp

  • Arbeitspapier

Beteiligte

  • Hartog, Joop
  • van Praag, Mirjam
  • van der Sluis, Justin
  • Tinbergen Institute

Entstanden

  • 2008

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