Edward P. Lazear
Stanford Graduate School of Business; National Bureau of Economic Research (NBER); Institute for the Study of Labor (IZA)
University of Illinois at Urbana-Champaign's Academy for Entrepreneurial Leadership Historical Research Reference in Entrepreneurship
A theory is proposed that individuals with a'balanced' set of skills are more likely to become entrepreneurs thanindividuals with specializations. A model of occupational choice whichsupports this theory is presented.The model also predicts that the uppertail of the income distribution is fatter for entrepreneurs than it is forspecialists. Empirical tests of the model are based on a survey,conducted in the late 1990s, of Stanford's Graduate School of BusinessAlumni. All 5,000 responses to the survey were studied in light of the respondents'school transcripts.The survey data supports the predictions offered bythe model: those with more varied experience started their own businesses morefrequently than those who took more specialized course loads. The data alsoconfirms that income distributions have fatter upper tails for entrepreneursthan for specialists, although the bottom is similar.In short,entrepreneurs are essentially"jacks-of-all-trades."(SAA)
Keywords: Stanford University Graduate School of Business, Entrepreneurship, Career choices, Business education, Skills, Background (biographical), Income distributionAccepted Paper Series
Date posted: November 24, 2009
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