NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH
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Dinner Table Human Capital and Entrepreneurship

Hans K. Hvide, Paul Oyer

NBER Working Paper No. 24198
Issued in January 2018, Revised in September 2019
NBER Program(s):Corporate Finance Program, Law and Economics Program, Labor Studies Program, Productivity, Innovation, and Entrepreneurship Program

We document three new facts about entrepreneurship. First, a majority of male entrepreneurs start a firm in the same or a closely related industry as their fathers’ industry of employment. Second, this tendency is correlated with intelligence: higher-IQ entrepreneurs are less likely to follow their fathers. Third, an entrepreneur that starts a firm in the same industry as where his father was employed tends to outperform entrepreneurs in the same industry whose fathers did not work in that industry. We consider various explanations for these facts and propose that “dinner table human capital”, where children obtain industry knowledge through their parents, is an important factor behind them.

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Document Object Identifier (DOI): 10.3386/w24198

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