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similarities in tastes for the self-employed lifestyle drives the relationship between

parents' and children's self-employment propensities.

The CBO also contains information on whether the owner previously worked "for

a business whose goods/service(s) were similar to those provided by this business "(U.S.

Department of Commerce 1997, p. C-4). This type of work experience undoubtedly

provides opportunities for acquiring job- or industry-specific business human capital in

addition to more general business human capital. Slightly more than half of all small

business owners report working in a similar business prior to starting their business.

Among owners who worked in a family member's business, 55.8 percent report

working in a business that provided similar goods and services. Unfortunately, however,

we cannot ascertain whether the family member's business is the same as the business

providing similar goods and services. Therefore, our estimate only provides an "upper

bound" estimate of the percent of owners who acquired specific business human capital

from working in a family member's business. Nevertheless, the estimate of roughly 50

percent suggests that family businesses are providing opportunities to acquire general

business human capital and not just specific business human capital. This finding is

consistent with the finding in Dunn and Holtz-Eakin (2000) that self-employed sons

follow their father's occupation in only 32 percent of cases.

Another explanation is that the children of self-employed business owners

become partners with their parents or directly inherit businesses. Forming a partnership

with a child may represent a less expensive, especially in terms of capital, method of

helping their children become business owners. Also, partnerships and inheritances may

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