We estimate the effect of college education on business survival using the NLSY79. The endogeneity of both education and business ownership is accounted for by a competing risks duration model augmented with a college selection equation. Contrary to the previous literature, we find no effect of college education on business failure. College however signicantly increases employment survival. Unlike college, cognitive skills have a positive impact on employment survival for both the self-employed and employees. The results suggest that college affects the self-employed and salaried employees in different ways, for example generating skills more useful in employment than self-employment.
Working Paper No. 1050
Does College Education Reduce Small Business Failure?
Working Paper
Reference
Asoni, Andrea and Tino Sanandaji (2014). “Does College Education Reduce Small Business Failure?”. IFN Working Paper No. 1050. Stockholm: Research Institute of Industrial Economics (IFN).
Asoni, Andrea and Tino Sanandaji (2014). “Does College Education Reduce Small Business Failure?”. IFN Working Paper No. 1050. Stockholm: Research Institute of Industrial Economics (IFN).
Authors
Andrea Asoni,
Tino Sanandaji