Direkt zum Inhalt

Entrepreneurship, Windfall Gains and Financial Constraints: The Case of Germany

Discussion Papers 480, 25 S.

Dorothea Schäfer, Oleksandr Talavera

2005. Feb.

get_appDownload (PDF  293 KB)

Published in: Economic Modelling 28 (2011), 5, 2174-2180


In this paper we investigate the link between entrepreneurship and financial constraints. We develop a dynamic partial equilibrium model of an individual utility maximization that predicts that the person is more likely to start her business when financial constraints are eased. We test this hypothesis using German Socio-Economic Panel data covering the periods 2000 - 2002 and measure release from financial constraints by windfall gains. The estimates confirm that the individual has higher propensity to start her business when she gets windfall gains. Furthermore, there are stronger effects for persons that have sufficient, but not very high levels of income and abilities.

Dorothea Schäfer

Forschungsdirektorin Finanzmärkte in the Macroeconomics Department

Topics: Firms

JEL-Classification: G3;J2;L1
Keywords: Entrepreneurship; Windfall gains; Financial constraints
Frei zugängliche Version: (econstor)