The entrepreneurship premium

August 16, 2019

Recent evidence suggests that entrepreneurship does not pay enough to compensate people for the risk that it entails. It sometimes even shows an entrepreneurship discount. This paper shows that such a discount can arise if entrepreneurial skills and working skills are negatively correlated in the population of agents. The paper also shows that in an otherwise standard occupational choice setting, the entrepreneurship premium rises with entrepreneurial scarcity and falls with their span of control. Finally, liquidity constraints on startups raise the entrepreneurship premium by lowering the equilibrium wage.

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CREALOGIX

We’re CREALOGIX, a global fintech organisation with over 600 employees globally. Our technology enables some of the world’s largest banks and wealth management firms to drive innovation – but it’s our people who make the difference. Our success is built on their expertise, team spirit and passion. Our goal is to deliver great technology to make our customers’ lives easier and more profitable. We want to shape the future world of fintech!CREALOGIX Holding AG (CLXN)’s shares are traded on the SIX Swiss Exchange.

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Spotlight

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We’re CREALOGIX, a global fintech organisation with over 600 employees globally. Our technology enables some of the world’s largest banks and wealth management firms to drive innovation – but it’s our people who make the difference. Our success is built on their expertise, team spirit and passion. Our goal is to deliver great technology to make our customers’ lives easier and more profitable. We want to shape the future world of fintech!CREALOGIX Holding AG (CLXN)’s shares are traded on the SIX Swiss Exchange.

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