Stopping Start-Ups: How the Business Cycle Affects Entrepreneurship

This study analyzes whether economic conditions at the time of labor market entry affect entrepreneurship, using difference in business start-ups between cohorts of college students graduating in boom or bust economic conditions. Those graduating during an economic bust tend to delay their business start-ups relative to boom period graduates by about two years. Those results are consistent with additional findings that higher unemployment rates at time of graduation significantly delay the first business start-up across all college graduation cohorts over the 1982-2004 period. The adverse effect of a bust is temporary, delaying but not preventing self-employment over the life-cycle.


Issue Date:
2009-07
Publication Type:
Working or Discussion Paper
PURL Identifier:
http://purl.umn.edu/54083
Total Pages:
27
Series Statement:
Econ Working Paper
09014




 Record created 2017-04-01, last modified 2017-08-25

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