%0 Report
        %A Parker, Simon C.
%A Praag, Mirjam C. van
        %T The Entrepreneur's Mode of Entry: Business Takeover or New Venture Start
        %D 2006
        %8 2006 Oct
        %I Institute of Labor Economics (IZA)
        %C Bonn
        %7 IZA Discussion Paper
        %N 2382
        %U https://www.iza.org/publications/dp2382
        %X We analyse the decision to become an entrepreneur by either taking over an established business or starting a new venture from scratch. A model is developed which predicts how several individual- and firm-specific characteristics influence entrepreneurs’ entry mode. The new venture creation mode is associated with higher levels of schooling and wealth, whereas managerial experience, new venture start-up capital requirements and risk promote the takeover mode. Entrepreneurs whose parents run a family firm are predicted to invest the least in schooling, since schooling reduces search costs and these individuals have the lowest probability of needing to search for a business opportunity outside their family. A sample of data on entrepreneurs from the Netherlands provides broad support for the theory; implications for policy-makers concerned about the survival of family firms lacking within-family successors are discussed.
        %K human capital
%K business takeover
%K entrepreneurship
%K business entry
%K venture start-up