Does the Entrepreneurship of the Parents Affect the Opportunities of their Offspring’s Entrepreneurship? Empirical Analysis Based on the CGSS 2010–2013 Data

Abstract

The whole society is paying close attention to “entrepreneurship,” which urges researchers to find an explanatory perspective relatively independent and with causality on the intergenerational transfer of entrepreneurship. Based on the data of the Chinese General Social Survey (short for CGSS) during the years 2010–2013, this paper analyzes how parents’ entrepreneurship affects the probability of their offspring’s entrepreneurship, and the results show that compared with the offspring of parents who did not start their own business, those whose parents did are more likely to choose to start their own business. In view of historical facts such as the “lay-off wave” during China’s transformation into a market economy, we use “the annual number of unemployed back to work,” a provincial-level indicator, in the 1990s as an instrumental variable to correct possible endogenous problems. We find that parents’ entrepreneurship has significant positive effects on the probability of their offspring’s entrepreneurship, which may result from the informal transfer of human capital and wealth from parents to their offspring.

Keywords

entrepreneurial opportunities / instrumental variable regression / lay-offs / intergenerational transfer

RIGHTS & PERMISSIONS

2018 Higher Education Press