Template-Type: ReDIF-Paper 1.0
Author-Name: Jarkko Harju
Author-Name-First: Jarkko
Author-Name-Last: Harju
Author-Email: jarkko.t.harju@tuni.fi
Author-Workplace-Name: Tampere University & Finnish Centre of Tax Systems Research (FIT)
Author-Name: Toni Juuti
Author-Name-First: Toni
Author-Name-Last: Juuti
Author-Email: toni.juuti@labore.fi
Author-Workplace-Name: Labour Institute for Economic Research & Tampere University & FIT
Author-Name: Tuomas Matikka
Author-Name-First: Tuomas
Author-Name-Last: Matikka
Author-Email: tuomas.matikka@vatt.fi
Author-Workplace-Name: VATT Institute for Economic Research & FIT
Title: Selection into Entrepreneurship, Income Mobility and Firm Performance
Abstract: Using full-population data from Finland, we show that individuals at the top of the income distribution are significantly more likely to start new incorporated businesses. High-income earners also establish more successful and productive businesses than others. In contrast, parental income is not linked with selection into new entrepreneurship or firm-level outcomes. We find that income gains from entrepreneurship are rather similar across individual and parental characteristics, and that entrepreneurship is associated with upward income mobility regardless of initial income levels. Overall, our findings suggest that entrepreneurship can serve as an upward economic ladder for individuals from diverse backgrounds.
Length: 76
Creation-Date: 2025-10
Publication-Status: Published in FIT Working Paper Series, Finnish Center of Excellence in Tax Systems Research
File-URL: https://verotutkimus.fi/verotutkimus/wp-content/uploads/2026/01/FIT-WP-41-Harju-Juuti-Matikka-Selection-into-Entrepreneurship.pdf
File-Format: Application/pdf
File-Function: Second version, 2025
Number: 41
Classification-JEL: L26, J24, J3
Keywords: entrepreneurship, income mobility, productivity
Handle:RePEc:fit:wpaper:41