Entrepreneurship and Job‐relatedness of Human Capital

Abstract

This paper proposes a theory according to which entrepreneurial ability to deal with the adoption of new technology is a key determinant of value creation in entrepreneurship. In a single conceptual framework, we demonstrate that a bimodal pattern of entrepreneurial entry emerges: both individuals possessing high job‐related human capital and individuals with low job‐related human capital enter entrepreneurship. Our empirical analysis, using information from the Scientists and Engineers Statistical Data System, shows that entrepreneurial earnings crucially depend on the level of job‐related human capital.