The experience of the founder and self-employment duration: A comparative advantage approach

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This paper investigates how the initial experience of a founder affects self-employment duration in a competing risks setting. The analysis uses survey data that provide new perspectives on the role of the founder's experience. The analysis concentrates on the importance of a balanced skill set for self-employment duration. The results show that most self-employed individuals find themselves unemployed upon ending their self-employment. Firm-level characteristics are less significant in explaining self-employment duration, while experience and motivation appear to be driving forces for self-employment longevity. The findings support the importance of combined practical experience and adequate skills. Having broad experience combined with competence in sales/business is one of the most important factors for self-employment duration. Contrary to most other studies, the results show that previous self-employment experience is associated with early exits.

Original languageEnglish
JournalSmall Business Economics
Issue number1
Pages (from-to)1-17
Number of pages17
Publication statusPublished - 07.2012

    Research areas

  • Balanced skill set, Competing risks, Duration, Human capital, Self-employment
  • Economics