Skill variety, innovation and new business formation

[The authors] extend Lazear's theory of skills variety and entrepreneurship in three directions. First, [the authors] provide a theoretical framework linking new business creation with an entrepreneur's skill variety. Second, in this model [the authors] allow for both generalists and specialists to possess skill variety. Third, [the authors] test [their] model empirically using data from Germany and the Netherlands. Individuals with more varied work experience seem indeed more likely to successfully start up a new business and that being a generalist does not seem to be important in this regard. Finally, [the authors] find that innovation positively moderates the relationship between having varied experiences, and being successful in starting up a new business. [The authors'] conclusion is that entrepreneurs with more varied work experience are more likely to introduce innovations that have not only technical, but also commercial value. [The authors'] findings support the notion that entrepreneurship can be learned.

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