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Are Entrepreneurs More Upwardly Mobile?

Matthew Lindquist () and Theodor Vladasel ()

No 1351, Working Papers from Barcelona School of Economics

Abstract: Entrepreneurship is often hailed as a path to upward intergenerational mobility, but few studies have explicitly tested this belief. We study intergenerational income rank mobility among entrepreneurs and employees in Sweden using high-quality measures of lifetime income for 215,000 father-son pairs. Incorporated entrepreneurs are more upwardly mobile than wage earners; this result is driven by selection and not by the causal impact of entrepreneurship on upward intergenerational mobility. By contrast, unincorporated entrepreneurs are more downwardly mobile, a result explained by selection, income underreporting, and lower returns to skills and education.

Keywords: entrepreneurship; incorporation; intergenerational mobility; lifetime income; upward mobility (search for similar items in EconPapers)
JEL-codes: J24 J62 L26 (search for similar items in EconPapers)
Date: 2022-06
New Economics Papers: this item is included in nep-ent, nep-eur and nep-sbm
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