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The Causal Link between Relative Age Effect and Entrepreneurship: Evidence from 17 Million Users across 49 Years on Taobao

Youwei Wang, Yuxin Chen and Yi Qian

No 25318, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We use an extensive panel of 17 million individuals born between 1947 and 1995 from China’s largest online marketplace, Taobao, to study the impact of RAE on the propensity to become an entrepreneur. Using events surrounding the Cultural Revolution and the issuance of the Compulsory Education Law whereby COD policies varied, we conceptualize a natural experiment to identify the RAE effects. The youngest students are 5.4% less likely to become an entrepreneur compared to the oldest within the cohort, translating to approximate 43.7 thousand additional sellers born in September with an estimated USD 1.29 billion in additional annual sales.

JEL-codes: I24 I38 J21 J24 (search for similar items in EconPapers)
Date: 2018-11
New Economics Papers: this item is included in nep-cna, nep-ent and nep-lma
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