The Opposing Effects of Wealth on Younger and Older Entrepreneurs

Philippe d’Astous (), Vyacheslav Mikhed, Sahil Raina and Barry Scholnick

No 25-32, Working Papers from Federal Reserve Bank of Philadelphia

Abstract: Using wealth windfalls from lottery winnings and matched employer-employee tax files, we compare the effect of additional wealth on the entrepreneurial activity of older and younger individuals. We find that additional wealth leads older winners (aged 55 to 64) to reduce business ownership and growth (as measured by sales, revenue, and employees). In contrast, extra wealth increases younger winners’ (aged 21 to 54) business ownership, but it has no effect on their business growth. The increase in business activity of a young winner does not offset the negative growth for an older winner, which may hurt economic growth.

Keywords: Wealth; Age; Entrepreneurship; Retirement (search for similar items in EconPapers)
JEL-codes: G5 G51 J22 L26 (search for similar items in EconPapers)
Pages: 63
Date: 2025-10-21
New Economics Papers: this item is included in nep-age, nep-ent, nep-fdg, nep-lma and nep-sbm
Note: Supersedes Working Paper 25-03 – How Wealth and Age Interact to Affect Entrepreneurship
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedpwp:101992

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DOI: 10.21799/frbp.wp.2025.32

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