Who becomes an entrepreneur and who survives?

A microeconometric study of self-employment and entrepreneurship in Finland in 1987-2004

The main aim of this research project is to analyse the processes and reasons which lead an individual to choose entrepreneurship or to leave it. The analyses are based on large individual-level panel data from the years 1987-2004 and extensive use of microeconometric methods.

The analysis includes two basic questions:

a)      To analyse the decision to start up a firm.  What factors affect this decision among different groups in Finland? What is the role of local environment (push or pull?); the role of earlier occupational status (wage work. vs. unemployed); the role of income and wealth;  the role of previous self-employment experience; the role of varied experience; the role of personal and family characteristics; the role of family background (intergenerational transmission of entrepreneurship); the role of characteristics related to childhood? Do earlier intentions predict entry into entrepreneurship?

b)      To analyse the exit and the duration of entrepreneur spells. One important aim is to analyse the role of region-specific factors as compared with individual-specific and other factors on the survival of firms.

The planned research project is divided into several parts. Each study analyses the basic questions from different starting points. The studies will concentrate on
- education and knowledge-based entrepreneurship
- the role of age and experience (young entrepreneurs)
- government intervention (start-up grants) and
- regional variation in entrepreneurship.

In addition, research papers on self-employment duration in urban and rural locations and female entrepreneurship will be written.

The project takes place at the University of Jyväskylä. The project leader is Hannu Tervo (professor in economics) and the principal researcher is Anu Tokila. In addition, the research team consists of Jaakko Pehkonen (professor in economics), Hannu Niittykangas (professor in entrepreneurship), Mika Haapanen (senior assistant in economics), Jari Ritsilä (leading researcher) and Academy research fellow Jouko Nätti (department of social sciences). 

Hannu Tervo
PO Box 35, FIN-40014 University of Jyväskylä
e-mail htervo(at)econ.jyu.fi