Business experience and start-up size: Buying more lottery tickets next time around?

Alex Coad (alex.coad@gmail.com), Julian Frankish, Paul Nightingale and Richard Roberts

Small Business Economics, 2014, vol. 43, issue 3, 529-547

Abstract: This paper explores the determinants of start-up size by focusing on a cohort of 6,247 businesses that started trading in 2004, using a unique dataset on customer records at Barclays Bank. Quantile regressions show that prior business experience is significantly related with start-up size, as are a number of other variables such as age, education and bank account activity. Quantile treatment effects (QTE) estimates show similar results, with the effect of business experience on (log) start-up size being roughly constant across the quantiles. Prior personal business experience leads to an increase in expected start-up size of about 50 %. Instrumental variable QTE estimates are even higher, although there are concerns about the validity of the instrument. Copyright Springer Science+Business Media New York 2014

Keywords: Start-up size; Entrepreneurship; Business experience; Learning; Quantile treatment effects; L26; L25 (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (17)

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DOI: 10.1007/s11187-014-9568-2

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