X hits on this document

PDF document

ECONOMIC GROWTH CENTER - page 17 / 34

85 views

0 shares

0 downloads

0 comments

17 / 34

The CBO also provides detailed information on other methods of acquiring

business human capital. Available questions include information on prior work

experience in a managerial capacity and prior work experience in a business whose goods

and services were similar to those provided by the owner's business. These variables may

have an important effect on small business outcomes.

The effects on small business outcomes of working for a self-employed family

member are generally stronger than the effects of previous work experience in a

managerial capacity. Management experience has a similar size effect in the profit and

employer probability equations, but has a much smaller effect on log sales and a positive

and statistically significant effect on business closures. Management experience prior to

starting or acquiring a business generally improves business outcomes, but has a less

consistent effect than experience working for a close relative.

The CBO also provides information on whether the owner worked in a business

whose goods and services were similar to those provided by his/her business. This more

general case of acquiring specific business human capital appears to be very important.

In fact, the coefficient estimates on a dummy variable for whether the owner had work

experience in a similar business are comparable in size to the coefficient estimates on

prior work experience in a family member's business in the closure probability and log

sales equations. The coefficient estimate is smaller in the employer probability equation,

but larger in the profits equation. In all specifications, the coefficient estimates are large

and statistically significant.

The inclusion of prior managerial experience and similar business experience

suggests that the large, positive coefficient estimates on working for a self-employed

15

Document info
Document views85
Page views85
Page last viewedTue Dec 06 22:29:42 UTC 2016
Pages34
Paragraphs1279
Words8832

Comments