Returns to Entrepreneurial Experience Over the Business Cycle (WITHDRAWN)

Abstract

In this paper, I explore business cycle-related dynamics in the returns to entrepreneurial experience. Using time-series geographic variation in economic conditions, I disentangle the effects of shocks to aggregate demand, alternative employment options, and credit availability on differences in firm exit rates between serial and novice entrepreneurs. Weibull survival model estimates indicate that serial entrepreneurs are more likely to endure negative shocks to aggregate income and credit availability, but are relatively more likely to go out of business as slack increases in the labor market. In the second part of the paper, I provide evidence that these dynamics are driven by differences in access to financial resources and business strategies.