Entrepreneurial skills and wage employment
International Journal of Manpower
Article publication date: 6 June 2016
Promotion of entrepreneurial skills is often considered as an adequate policy to enhance job creation and economic growth. However, neither the definition of entrepreneurial skills, nor the costs and benefits of such a policy are clear. The purpose of this paper is to check whether the benefits of entrepreneurial skills extent beyond self-employment. The authors denote entrepreneurial skills as those competencies that enhance the likelihood of self-employment. Then the authors analyze whether they are rewarded in wage employment.
The authors estimate a Heckman selection model with wages in a salaried job as the main dependent variable and working in wage employment vs self-employment as the selection equation. The authors use a sample of higher education graduates from Spain, from the year 2000 interviewed in 2005 within the REFLEX survey.
Results reveal that alertness to new opportunities, ability to mobilize others and knowledge of other fields are the competencies that enhance self-employment in Spain. Yet, these skills are not rewarded in a salaried job. Therefore, benefits of policies fostering entrepreneurial skills do not extend to wage employment in Spain.
The exclusion restriction used in the analysis is father’s education. The authors assume that all the effect of parental education on wages goes through education attainment of the individual and her ability (proxied by her grade in secondary education). A better proxy for ability would be desirable.
The authors identify which competencies enhance self-employment in Spain. The authors find that these competencies are not rewarded in wage employment, so the benefits of policies promoting entrepreneurial education remain within self-employment activity only.
Montserrat Vilalta-Bufí gratefully acknowledges financial support from the Spanish Ministry of Science and Innovation through the grant ECO2015-66701-R. The authors also wish to thank the financial support of the Government of Catalonia through the Barcelona GSE Research Network and grant 2014SGR_493 and the REFLEX project for granting access to their data.
Kucel, A. and Vilalta-Bufi, M. (2016), "Entrepreneurial skills and wage employment", International Journal of Manpower, Vol. 37 No. 3, pp. 556-588. https://doi.org/10.1108/IJM-01-2015-0021
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