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Habitual entrepreneurs in the making: how labour market rigidity and employment affects entrepreneurial re-entry

Kun Fu (), Anne-Sophie Larsson () and Karl Wennberg ()
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Kun Fu: Loughborough University
Anne-Sophie Larsson: Ratio Institute
Karl Wennberg: Linköping University

Small Business Economics, 2018, vol. 51, issue 2, 465-482

Abstract: Abstract We investigate the impact of country-level labour market regulations on the re-entry decision of experienced entrepreneurs, whereby they become habitual entrepreneurs. Multilevel logit models on entry decisions among 15,709 individuals in 29 European countries show that labour market regulations have a positive influence on the decision to re-enter into entrepreneurship. This positive impact is stronger among individuals holding wage jobs at the time of re-entry compared to those that do not. Our results indicate that novice and habitual entrepreneurs may respond very differently to labour market rigidity. We discuss and provide tentative explanations for these differences and outline potential policy implications.

Keywords: Habitual entrepreneurship; Employment; Labour market rigidity; Institutional context; Multilevel modelling; J24; J41; K31; L26 (search for similar items in EconPapers)
Date: 2018
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