Working Paper: NBER ID: w28547
Authors: Ruixue Jia; Xiaohuan Lan; Gerard Padri Miquel
Abstract: While intergenerational transmission of entrepreneurship is a well-known regularity, we hypothesize that in a transition economy where the state retains an important role, those whose parents are government workers may also be more likely to become business owners. We test the hypothesis in China and show that (1) on average, both entrepreneurs and government workers have a higher likelihood of having children who own incorporated businesses and (2) In provinces where government involvement is higher, the likelihood that children of government workers (entrepreneurs) own incorporated businesses is significantly higher (lower). Our study demonstrates that the local economic business environment shapes the influence of parental background on business ownership.
Keywords: entrepreneurship; government intervention; China; parental background
JEL Codes: D02; D72; O12; O38; O53
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| parental background (J12) | business ownership (L26) |
| cadre parental background (J45) | business ownership (L26) |
| cadre parental background (J45) | self-employment (L26) |
| PGE (D50) | business ownership of children of entrepreneurs (L26) |
| PGE (D50) | business ownership of children of cadre parents (P31) |
| parental background + PGE (J19) | business ownership (L26) |
| education of parent + PGE (I24) | business ownership (L26) |
| political connections (D72) | business opportunities for cadre children (J45) |