Do Entrepreneurs Matter?
66 Pages Posted: 12 Jan 2013 Last revised: 22 May 2017
Date Written: May 18, 2017
What are the most critical factors for the growth and survival of nascent firm? We use deaths of several hundred entrepreneurs as a source of exogenous variation of entrepreneur engagement, and find large and sustained effects of entrepreneurs at all levels of the firm performance and firm size distribution. The mean effect on sales and assets is about 50 percent. We find large effects of entrepreneur death until the startup is about seven years old. The effects appear to be driven by entrepreneur specialness rather than leadership transition; the effects of death of entrepreneur-managers is economically and statistically stronger than the death of managers that are not entrepreneurs.
Keywords: entrepreneurship, firm performance, human capital
JEL Classification: D21, D24, J23, L11, L25, G39
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