Start-up motivation and (in)voluntary exit

Jolanda Hessels and Peter van der Zwan

No H201309, Scales Research Reports from EIM Business and Policy Research

Abstract: We investigate the role of an entrepreneur’s start-up motivation in determining the mode of entrepreneurial exit. A distinction is made between involuntary exit through business failure and voluntary exit through business sell-out or transfer. Regarding an entrepreneur’s start-up motivation, we include two measures distinguishing between opportunity and necessity motivated business owners. Internationally comparable data from 2009 for 35 countries containing more than 2,600 former business owners are used. We find some evidence that necessity business owners are more likely to exit through failure than opportunity business owners or business owners that are driven by a combination of opportunity and necessity reasons. We argue that necessity business owners have lower entrepreneurial ability than opportunity business owners and run lower quality businesses which increases their probability of failure versus sell-out. Entrepreneurial ability seems to play a role beyond the human capital aspects that are included in the model.

Pages: 21 pages
Date: 2013-06-04
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.entrepreneurship-sme.eu/pdf-ez/H201309.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eim:papers:h201309

Access Statistics for this paper

More papers in Scales Research Reports from EIM Business and Policy Research Contact information at EDIRC.
Bibliographic data for series maintained by Webmaster EIM (webbureau@eim.nl this e-mail address is bad, please contact repec@repec.org).