Three essays on entrepreneurial entry, serial entrepreneurship, and labor turnover

This study explores two important aspects of entrepreneurship — liquidity constraints and serial entrepreneurs, with an additional analysis of occupational choice among wage workers. In the first essay, I revisit the question of whether entrepreneurs face liquidity constraints in business formation. The principle challenge is that wealth is correlated with unobserved ability, and adequate instruments are often difficult to identify. This paper uses the son's birth order as an instrument for household wealth. I exploit the data available in the Korean Labor and Income Panel Study, and find evidence of liquidity constraints associated with self-employment in South Korea. The second essay develops and tests a model that explains entry into serial entrepreneurship and the performance of serial entrepreneurs as the result of selection on innate ability. The model supposes that agents establish businesses with imperfect information about their entrepreneurial ability and the profitability of business ideas. Agents continually observe signals with which they update their beliefs, and this process eventually determines their next business choice. Selection on ability induces a positive correlation between entrepreneurial experience (measured by previous business earnings and founding experience) and serial business formation, as well as its subsequent performance. The predictions in the model are tested using panel data from the NLSY79. The analysis permits a distinction to be made between selection on innate ability and learning by doing. Motivated by previous empirical findings that white-collar workers had higher turnover rates than blue-collar workers during firm expansion, the third essay further examines job turnover among workers with or without specific skills. I present a search-matching model, which predicts that when firm growth is driven by technological advance, workers whose skills are specific to the obsolete technology show a higher tendency to separate from their jobs. This hypothesis is tested with data from the PSID. I find supportive evidence that in the context of technological change, having an occupation requiring specific skills, such as computer specialists or engineers, increases the odds of job separation by nearly eight percent. ^

Parental absence and academic achievement in immigrant students

Academic achievement and educational expectations as a function of parental absence were examined among 268 newly immigrant elementary, middle, and high-school students from Spanish-speaking countries. Data collected as part of a longitudinal study of adaptation and achievement in newly immigrant students were analyzed. Participants had varying experiences with parental absence, in terms of length of absence, gender of absent parent, and reason for absence. Reasons for parental absence included parental divorce, parental death, and serial migration, a cause unique to immigrant children. Students who experienced parental absence reported lower educational expectations. Students who experienced the death of a parent had lower achievement scores and lower expectations than students who did not experience parental death. Prolonged absence was also important, with students who experienced parental absence for more than one year performing worse than students who had minimal parental separation. In addition, boys who experienced parental absence because of serial migration performed worse academically than boys who did not have this occurrence. Educational expectations were reduced among students who experienced parental absence as a result of the migratory process, especially for younger students. The extent to which parental absence related to achievement and expectations through potential mediating factors, such as economic hardship, perceived school support, and parental school involvement was assessed with structural equation modeling. Overall, the model was able to explain some of the relationship between parental absence and the academic achievement and educational expectations of immigrant students from Spanish-speaking countries.^