Non-cognitive skills, occupational choices, and entrepreneurship: an empirical analysis of entrepreneurs' career choices

Abstract

Entrepreneurship literature provides evidence that non-cognitive skills, such as personality traits, predict entrepreneurial behaviour in terms of creating and managing a business venture. This study shows that an entrepreneurship-prone personality is strongly associated with other career decisions that are likely to lead to entrepreneurship, such as a choice of an occupation. Empirical analysis is based upon a representative survey of households, the German Socio-Economic Panel data (SOEP). The sample contains 46,489 observations, 10.3% of which refer to self-employed individuals. The findings suggest that entrepreneurial personalities are significantly more likely to be attracted by Holland's artistic, investigative, enterprising, and social occupations, and they are significantly less likely to choose realistic and conventional occupations. Moreover, non-cognitive skills, human capital variables and socio-demographic characteristics are differently associated with entrepreneurship in various occupations. The implications of the results for entrepreneurship research and practice are discussed.