The validity of family background variables instrumenting education in income regressions has been much criticized. In this paper, we use data from the 2004 German Socio-Economic Panel and Bayesian analysis to analyze to what degree violations of the strict validity assumption affect the...

Education is a well-known driver of (entrepreneurial) income. The measurement of its influence, however, suffers from endogeneity suspicion. For instance, ability and occupational choice are mentioned as driving both the level of (entrepreneurial) income and of education. Using instru-mental...

We analyze the effect of peer influence on the diffusion of an innovative network good. We argue that the adopters of a network good have an incentive to convince others to purchase the same product because their utility depends on the number of other users. This peer-effect influences...

We analyze the effect of peer influence on the diffusion of an innovative network good, argu-ing that the adopters of a network good have an incentive to convince others to purchase the same product because their utility depends on the number of other users. This peer-effect influences...

Bootstrap financing refers to measures that entrepreneurial ventures undertake to preserve li-quidity (e.g., reducing expenses, collecting receivables, delaying payments, preselling). Prior research shows that bootstrap financing is an important enabler for the growth of resource-constrained...