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“I Want to, But I Also Need to”: Start-Ups Resulting from Opportunity and Necessity

Aufsätze in Sammelwerken 2019

Marco Caliendo, Alexander S. Kritikos

In: From Industrial Organization to Entrepreneurship : A Tribute to David B. Audretsch
Cham: Springer
S. 247-265


When unemployed persons start businesses, they are often characterized as necessity entrepreneurs because push motives, namely their unemployment, likely prompted their decision. Based on a panel data set of more than 2600 start-ups by unemployed persons, we show that not only push but also pull motives can be observed among previously unemployed business founders. Moreover, a third type of entrepreneur emerges, motivated by a combination of both push and pull factors. When analysing the entrepreneurial performance of these three motivational types over a period of nearly 5 years, we reveal that motivation matters even in the long term: pull type entrepreneurs have higher survival rates and do create more jobs than push type entrepreneurs. Entrepreneurs being motivated by a combination of both, i.e. the start-ups resulting from opportunity and necessity fall between the two extremes.

Topics: Firms

Keywords: Entrepreneurship, Push and pull motives, Opportunity and necessity, Business failure, Job creation