Homeownerhip and entrepreneurship
Christian Hilber () and
Olmo Silva ()
LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library
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: D14 G11 L20 R21 (search for similar items in EconPapers)
Pages: 45 pages
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http://eprints.lse.ac.uk/58436/ Open access version. (application/pdf)
Working Paper: Homeownerhip and Entrepreneurship (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:58436
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