Does Higher Education Make You More Entrepreneurial? Causal Evidence from China

Bin Huang, Max Tani and Yu Zhu
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Bin Huang: Nanjing University of Finance and Economics

No 14310, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Using the 2017 China Household Finance Survey (CHFS), we estimate the effect of higher education on entrepreneurship for prime-aged males. We distinguish between own-account workers and employers of small and large businesses, respectively, and use the higher education expansion in China starting in 1999 and instruments of pre-school hukou status to help identify causal effects. While our Inverse Probability Weighted Regression Adjustment estimates show that people with more education are less likely to enter entrepreneurship in general, obtaining any qualification beyond the baseline of compulsory schooling significant increases large business ownership later in life, with the maximum effect corresponding to a 3-fold increase found for university graduates. We attribute this effect to graduates taking full advantage of the opportunities presented by access to education earlier on in their lives.

Keywords: China; higher education expansion; entrepreneurship; higher education; Inverse Probability Weighted Regression Adjustment (IPWRA) (search for similar items in EconPapers)
JEL-codes: I25 J24 L26 (search for similar items in EconPapers)
Pages: 41 pages
Date: 2021-04
New Economics Papers: this item is included in nep-cna, nep-edu, nep-ent and nep-lma
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

Published - published in: Journal of Business Research, 2021, 135, 543-558.

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