Entrepreneurial Exit in Real and Imagined Markets

Tinbergen Institute Discussion Paper No. 08-031/3

20 Pages Posted: 1 Apr 2008

See all articles by Erik Stam

Erik Stam

Utrecht University - School of Economics; Utrecht University - Tjalling C. Koopmans Research Institute

Roy Thurik

Erasmus University Rotterdam (EUR) - Centre for Advanced Small Business Economics (CASBEC); Montpellier Business School; Erasmus Research Institute of Management (ERIM); EIM Netherlands - Business and Policy Research; Tinbergen Institute

Peter van der Zwan

Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE)

Date Written: March 2008

Abstract

Entrepreneurs exit their business due to selection mechanisms experienced in the market place. Next to this well known ex-post decision to exit, entrepreneurs select ex-ante whether they are willing to pursue an entrepreneurial career at all, or to give up these entrepreneurial intentions. This paper compares the role of personal and ecological factors as determinants of these two types of selection: exit in real and in imagined markets. Entrepreneurs in imagined markets are more likely to exit in strong welfare state regimes, while real entrepreneurs are more likely to exit when they have low levels of human capital and when they are located in metropolitan areas.

Keywords: entrepreneurship, nascent entrepreneurs, entrepreneurial exit, market selection

JEL Classification: J23, L26

Suggested Citation

Stam, Erik and Thurik, Roy and Thurik, Roy and van der Zwan, Peter, Entrepreneurial Exit in Real and Imagined Markets (March 2008). Tinbergen Institute Discussion Paper No. 08-031/3, Available at SSRN: https://ssrn.com/abstract=1114022 or http://dx.doi.org/10.2139/ssrn.1114022

Erik Stam

Utrecht University - School of Economics ( email )

Kriekenpitplein 21-22
Adam Smith Building
Utrecht, +31 30 253 7373 3584 EC
Netherlands

Utrecht University - Tjalling C. Koopmans Research Institute ( email )

Adam Smith Building
Kriekenpitplein 21-22
Utrecht, 3584 EC
Netherlands

Roy Thurik

Erasmus University Rotterdam (EUR) - Centre for Advanced Small Business Economics (CASBEC) ( email )

3000 DR Rotterdam
Netherlands
+31 10 408 2232 (Phone)
+31 10 408 9146 (Fax)

HOME PAGE: http://www.thurik.com

Montpellier Business School

France

Erasmus Research Institute of Management (ERIM) ( email )

P.O. Box 1738
3000 DR Rotterdam
Netherlands

EIM Netherlands - Business and Policy Research

Postbus 7001
2701 AA Zoetermeer
Netherlands
+31 79 341 3634 (Phone)
+31 79 331 3742 (Fax)

Tinbergen Institute ( email )

Burg. Oudlaan 50
Rotterdam, 3062 PA
Netherlands

Peter Van der Zwan (Contact Author)

Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE) ( email )

P.O. Box 1738
3000 DR Rotterdam, NL 3062 PA
Netherlands

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