2018

When is Your Experience Valuable? Occupation-Industry Transitions and Self-Employment Success

Reprint No. 2018:33

Author(s): Sierdjan Koster and Martin AnderssonYear: 2018 Title: Journal of Evolutionary Economics Volume (No.): 28 (2) Pages: 265–286
Online article (restrictions may apply)

When is Your Experience Valuable? Occupation-Industry Transitions and Self-Employment Success Sierdjan Koster and Martin Andersson


The literature on employee spinoffs has, for a long time, stressed the importance of industry-specific skills and experiences in explaining the success of new firms. We argue that employees also develop skills that are associated with their occupation within an industry, and that success as an entrepreneur, therefore, is also contingent on the relation between the entrepreneurs’ previous occupation and the industry in which they operate as self-employed. Using matched employer-employee data, we develop a measure, occupational spin-offs, that accounts for this relation. An occupational spin-off is defined as a start-up in the most common industry, given the previous occupation of the founder. We then show that entrepreneurs starting occupational spinoffs enjoy above average income from self-employment and have longer spells as business owners.


Reference:
Koster, Sierdjan and Martin Andersson (2018), "When is Your Experience Valuable? Occupation-Industry Transitions and Self-Employment Success". Journal of Evolutionary Economics 28(2), 265–286.

Martin Andersson

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Martin Ljunge, IFN, is the author of a chapter, "Trust promotes health: addressing reverse causality by studying children of immigrants", in a new book edited by Sherman Folland and Eric Nauenberg. The cutting edge of research is presented, covering the ever-expanding social capital field.

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