The higher returns to formal education for entrepreneurs versusemployees in Australia
Journal of Business Venturing Insights , Volume 13 - Issue e00148
Van Praag et al. (2013) analyze whether the returns to formal education in terms of income differ between entrepreneurs and employees. Using US data (1979–2000), they find that entrepreneurs have higher returns to formal education than employees. They also find evidence that the level of personal control in one’s occupation explains these higher returns. In the present study, we aim to replicate these findings using a dataset from a different country (Australia) and time period (2005–2017). Moreover, we extend the study by Van Praag et al. (2013) by distinguishing between entrepreneurs with and without employees. In accordance with Van Praag et al. (2013), we also find higher returns to education for entrepreneurs compared to employees. However, this finding mainly applies to the entrepreneurs without employees. Moreover, we do not find evidence for a mediating role of personal control in this relationship.
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Hessels, S.J.A, Rietveld, C.A, Thurik, A.R, & Van der Zwan, P. (2020). The higher returns to formal education for entrepreneurs versusemployees in Australia. Journal of Business Venturing Insights, 13(e00148). Retrieved from http://hdl.handle.net/1765/121516