On the relationship between household wealth and entrepreneurship

• Main Author: LEE, Jungho
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2017
• Subjects: entrepreneurship; financial constraints; credit borrowing; Behavioral Economics; Entrepreneurial and Small Business Operations; Industrial Organization
• Online Access: https://ink.library.smu.edu.sg/soe_research/2104; https://ink.library.smu.edu.sg/context/soe_research/article/3104/viewcontent/Entrepreneurship_Wealth_2017_wp.pdf
• Institution: Singapore Management University

Motivated by a substantial number of startup owners with negative household net worth, I present a model that incorporates credit borrowing into Evans and Jovanovic [1989]. The estimated model generates no relationship between household wealth and the propensity for business entry. Ignoring credit b...