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Title:The skill balancing act: Determinants of and returns to balanced skills PDF Logo
Authors:Bublitz, Elisabeth
Noseleit, Florian
Issue Date:2011
Series/Report no.:Jena economic research papers 2011,025
Abstract:Entrepreneurs are found to have balanced skill sets and most have worked in small firms before starting their own business. In light of this, we compare the skill sets of employees working in businesses of different size to the skill sets of entrepreneurs using a rich data set on the applied skills of individuals. This data set allows us to construct an indicator that measures skill balance in the uantity (skill scope) and quality (skill level) dimension. Our results show that employees working in large businesses tend to have a lower skill balance than those working in small businesses; yet, the skill balance of entrepreneurs remains the largest. The impact of human capital formation on skill balance also varies among employees of different business sizes and entrepreneurs. Finally, the estimated returns to balanced skills are largest for entrepreneurs whereas, for employees, these returns decrease as business size increases. However, we find no relationship between balancing skills at lower skill levels and income, indicating that both dimensions - skill level and skill scope - are relevant. We end by discussing the policy implications that can be drawn from our results in regard to skill balance.
Subjects:entrepreneurship
returns to human capital
balanced skill set
jack-of-all-trades
JEL:J24
J31
L26
M13
Document Type:Working Paper
Appears in Collections:Jena Economic Research Papers, MPI für Ökonomik

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