Abstract
Previous research on age and entrepreneurship assumed homogeneity and downplayed age-related differences in the motives and aims underlying enterprising behaviour. We argue that the heterogeneity of entrepreneurship influences how the level of entrepreneurial activity varies with age. Using a sample of 2,566 respondents from 27 European countries, we show that entrepreneurial activity increases almost linearly with age for individuals who prefer to only employ themselves (self-employers), whereas it increases up to a critical threshold age (late 40s) and decreases thereafter for those who aspire to hire workers (owner-managers). Age has a considerably smaller effect on entrepreneurial behaviour for those who do not prefer self-employment but are pushed into it by lack of alternative employment opportunities (reluctant entrepreneurs). Our results question the conventional wisdom that entrepreneurial activity declines with age and suggest that effective responses to demographic changes require policy makers to pay close attention to the heterogeneity of entrepreneurial preferences.
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Notes
Examples of research include Curran and Blackburn (2001), Kautonen et al. (2011), Sing and DeNoble (2003) and Weber and Schaper (2004). Examples of relevant policy initiatives include the Prince’s Initiative for Mature Enterprise in the United Kingdom (www.prime.org.uk), the 50 + Course as part of the Australian New Enterprise Incentive Scheme (http://www.gramets.com.au/what_is_neis.html) and the OECD-EU Project on Self-employment and Entrepreneurship in Europe in which one of the foci is senior entrepreneurship (http://www.oecd.org/document/60/0,3746,en_2649_34417_49308796_1_1_1_1,00.html).
For a discussion of the differences between entrepreneurial types comparable to our owner-managers and self-employers, see Kelley et al. (2010).
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Acknowledgments
This research received support from the Academy of Finland (grant numbers 135696, 140973). We thank the editor and the two anonymous reviewers for their invaluable comments and suggestions.
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Kautonen, T., Down, S. & Minniti, M. Ageing and entrepreneurial preferences. Small Bus Econ 42, 579–594 (2014). https://doi.org/10.1007/s11187-013-9489-5
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DOI: https://doi.org/10.1007/s11187-013-9489-5