Mecca or Mirage? The Determinants and Outcomes of Entrepreneurship of Recent Harvard Business School Graduates
University of California, Berkeley - Department of Economics; University of California, Berkeley - Haas School of Business; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR); Institute for the Study of Labor (IZA)
Harvard Business School - Finance Unit; Harvard University - Entrepreneurial Management Unit; National Bureau of Economic Research (NBER)
March 15, 2007
AFA 2008 New Orleans Meetings Paper
A core question in the analysis of entrepreneurship is which determinants induce people to become entrepreneurs and which determinants predict entrepreneurial success. We use a unique data set on Harvard Business School graduates from 1997 to 2004, who participated in a business plan contest, to analyze this question. We find that family status, risk aversion, and academic achievement are orthogonal to the decision to become entrepreneur but have strong predictive power for entrepreneurial success. Moreover, while the business school environment and, in particular, business school peers appear to induce more entrepreneurship, they are also associated with entrepreneurial failure. Our findings suggest that business school graduates may not sufficiently adjust to the importance of individual predictors of entrepreneurial success.
Keywords: Entrepreneurship, Peer Effects
JEL Classification: M13, G1
Date posted: March 19, 2007
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