Opportunity Costs and Entrepreneurial Activity
Based on an analysis of a game-theoretic model developed by Amit, Glosten, and Muller in 1994, the following hypothesis is posited and investigated: entrepreneurs are more likely to undertake entrepreneurial activities when their opportunity costs are lower. Data were gathered from the Longitudinal 1988-1990 Labor Market Activity Survey of Canadian Workers of 352 individuals classified as "new entrepreneurs" - that is, they have moved from paid work to self-employment to the hiring of others. Findings indicate that paid workers who chose to become entrepreneurs earned significantly less as wage workers than those whose employment status did not change (i.e., who remained paid employees) during the three-year period. Further research is needed to determine causality. Are less capable workers starting their own businesses, thus accounting in part for high venture failure rates? Or are those who leave their previous work people whose entrepreneurial abilities and attitudes do not fit a corporate setting? This initial study does at least suggest that workers who have less to lose - i.e., lower opportunity costs - are those who become entrepreneurs. (SFL)
Year of publication: |
2011
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Authors: | Amit, Raphael ('Raffi") H. |
Other Persons: | Muller, Eitan (contributor) ; Cockburn, Iain M. (contributor) |
Publisher: |
[2011]: [S.l.] : SSRN |
Subject: | Opportunitätskosten | Opportunity cost | Entrepreneurship | Entrepreneurship approach | Selbstständige | Self-employed | Unternehmensgründung | Business start-up | Lohn | Wages |
Description of contents: | Abstract [papers.ssrn.com] |
Saved in:
Extent: | 1 Online-Ressource |
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Type of publication: | Book / Working Paper |
Language: | English |
Notes: | In: Journal of Business Venturing, Vol. 10, Issue 2, p. 95-106 1995 Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments 1995 erstellt Volltext nicht verfügbar |
Source: | ECONIS - Online Catalogue of the ZBW |
Persistent link: https://www.econbiz.de/10013134200
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