The growth of entrepreneurial human capital: origins and development of skill variety

Alexander Krieger,Katariina Salmela-Aro,Martin Obschonka,Michael Stuetzer

doi:10.1007/s11187-021-00555-9

Abstract

Given that recent research on entrepreneurial behavior and success has established skill variety as a central human capital factor, researchers, educators, and policymakers have turned their interest to a deeper understanding of the formation of skill variety. Based on human capital theory and the competence growth approach in developmental psychology (highlighting long-term, age-appropriate, and cumulative skill-growth processes), we hypothesize that a broad, early variety orientation in adolescence is a developmental precursor of such entrepreneurial human capital in adulthood. This was confirmed in an analysis of prospective longitudinal data via structural equation modeling and serial mediation tests. We also find that an entrepreneurial constellation of personality traits, but not entrepreneurial parents, predicts early variety orientation, skill variety, and entrepreneurial intentions. By shedding new light on the long-term formation of entrepreneurial human capital, the results suggest that establishing and benefiting from an early variety orientation is not only an important developmental mechanism in entrepreneurial careers but gives those with an entrepreneurial personality an early head start in their vocational entrepreneurial development. Implications for future research and practice are discussed.

Highlights

Why do some people become entrepreneurs while others stay in paid employment? What predicts entrepreneurial success? A great deal of research investigating these fundamental questions has focused on human capital (Canavati et al, 2021; Davidsson & Gordon, 2012; Unger et al, 2011)
We tested our hypotheses with structural equation modeling (SEM), utilizing Stata 12.1 (Acock, 2013)
Skill variety, an early variety orientation, as well as entrepreneurial intentions were modeled as latent variables

Summary

Introduction

Why do some people become entrepreneurs while others stay in paid employment? What predicts entrepreneurial success? A great deal of research investigating these fundamental questions has focused on human capital (Canavati et al, 2021; Davidsson & Gordon, 2012; Unger et al, 2011). The most important development in this research field has been Lazear’s (2005) skill variety model. Searching for a distinctive set of entrepreneurial skills and abilities that matches the profile of the entrepreneurial task, Lazear (2005) introduced a theoretical model focusing on a varied skill set in entrepreneurs. He argues that because entrepreneurs perform many different tasks, they should be multi-skilled in various areas, for example, developing a business model, talking to customers, working in a team, and negotiating with suppliers. Skill variety often has positive performance effects (Aldén et al, 2017; Åstebro & Thompson, 2011; Patel & Ganzach, 2019; Rosendahl Huber et al, 2020)

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