Who Creates New Firms When Local Opportunities Arise?

70 Pages Posted: 21 Mar 2018 Last revised: 5 Feb 2019

See all articles by Shai Bernstein

Shai Bernstein

Stanford Graduate School of Business

Emanuele Colonnelli

University of Chicago - Booth School of Business

Davide Malacrino

International Monetary Fund

Timothy McQuade

Stanford University

Date Written: February 2, 2019

Abstract

We examine the characteristics of the individuals who become entrepreneurs when local opportunities arise. We identify local demand shocks by linking fluctuations in global commodity prices to municipality level agricultural endowments in Brazil. We find that the firm creation response is almost entirely driven by young and skilled individuals. Their response is larger in municipalities with better access to finance and more skilled human capital, and is driven entirely by the formal market. These results highlight how the composition of the local population can have a significant impact on the entrepreneurial responsiveness of the economy.

Suggested Citation

Bernstein, Shai and Colonnelli, Emanuele and Malacrino, Davide and McQuade, Timothy, Who Creates New Firms When Local Opportunities Arise? (February 2, 2019). Available at SSRN: https://ssrn.com/abstract=3143190 or http://dx.doi.org/10.2139/ssrn.3143190

Shai Bernstein

Stanford Graduate School of Business ( email )

655 Knight Way
Stanford, CA 94305-5015
United States

Emanuele Colonnelli (Contact Author)

University of Chicago - Booth School of Business ( email )

HOME PAGE: http://emanuelecolonnelli.com

Davide Malacrino

International Monetary Fund ( email )

700 19th St NW
Washington, DC 20001
United States

Timothy McQuade

Stanford University ( email )

Stanford, CA 94305
United States

Register to save articles to
your library

Register

Paper statistics

Downloads
77
Abstract Views
633
rank
321,827
PlumX Metrics