Spouses, children and entrepreneurship

Joao Galindo da Fonseca and Charles Berubé
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Charles Berubé: Innovation, Science and Economic Development Canada

No 2020-03, Cahiers de recherche from Universite de Montreal, Departement de sciences economiques

Abstract: We develop a model of endogenous entrepreneurship and marriage. Spouses influence entrepreneurship via three channels: they reduce benefits by working less the more profitable the business is, they reduce costs by working more in case of business failure, and children, associated with a spouse, increase the cost of failure. We use administrative matched owner-employer-employee spouse data to estimate the specifications derived from our model. The model is informative on the sources of endogeneity and the IV strategy. We show that higher marriage rates induce less entry but larger firms on average. Through the lens of our model, marriage increases firm productivity.

Keywords: Labor markets; Family economics; Macroeconomics; Firm dynamics (search for similar items in EconPapers)
JEL-codes: E23 E24 J12 J60 (search for similar items in EconPapers)
Date: 2020-04
New Economics Papers: this item is included in nep-ent, nep-mac and nep-sbm
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http://hdl.handle.net/1866/23275 (application/pdf)

Related works:
Journal Article: SPOUSES, CHILDREN, AND ENTREPRENEURSHIP (2023)
Working Paper: Spouses, Children and Entrepreneurship (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:mtl:montde:2020-03

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