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Homeownerhip and Entrepreneurship

Philippe Bracke, Christian Hilber () and Olmo Silva ()

SERC Discussion Papers from Spatial Economics Research Centre, LSE

Abstract: We study the link between homeownership and entrepreneurship by exploiting the longitudinal dimension of the British Household Panel Survey (BHPS) and constructing a detailed monthly-spell dataset that tracks individuals? job history and tenure choice, coupled with other time-varying characteristics. Our fixed-effects estimates show that purchasing a house reduces the likelihood of starting a business by 20-25%. This result is driven by homeowners with mortgages and persists for several years after entering homeownership. The negative link can be rationalized by portfolio considerations: leveraged housing investments crowd out entrepreneurial investments. Alternative explanations based on credit constraints find little support in our data.

Keywords: Entrepreneurship; homeownership; panel estimation (search for similar items in EconPapers)
JEL-codes: L26 D14 G11 R21 (search for similar items in EconPapers)
Date: 2012-04
New Economics Papers: this item is included in nep-ent and nep-ure
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Related works:
Working Paper: Homeownership and Entrepreneurship: The Role of Commitment and Mortgage Debt (2013) Downloads
Working Paper: Homeownerhip and entrepreneurship (2012) Downloads
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