Abstract for:

Homeownerhip and Entrepreneurship

Philippe  Bracke,  Christian  Hilber,  Olmo  Silva,  April 2012
Paper No' SERCDP0103: | Full paper

---

Save Reference as: BibTeX File | EndNote Import File

---

Keywords: Entrepreneurship; homeownership; panel estimation

JEL Classification: L26; D14; G11; R21

Is hard copy/paper copy available? YES - Paper Copy Still In Print.

---

This Paper is published under the following series:

---

Share: Google Bookmarks | Facebook | Twitter

---

Abstract:

We study the link between homeownership and entrepreneurship by exploiting the longitudinal dimension of the British Household Panel Survey (BHPS) and constructing a detailed monthly-spell dataset that tracks individuals‟ job history and tenure choice, coupled with other time-varying characteristics. Our fixed-effects estimates show that purchasing a house reduces the likelihood of starting a business by 20-25%. This result is driven by homeowners with mortgages and persists for several years after entering homeownership. The negative link can be rationalized by portfolio considerations: leveraged housing investments crowd out entrepreneurial investments. Alternative explanations based on credit constraints find little support in our data.