Maddalena Ronchi, an assistant professor of finance at Kellogg, has been intrigued by the implications of gender equality and the economy. Research has shown that increasing the representation of women in traditionally male-dominated fields can boost overall productivity. Furthermore, having more talented women pursue entrepreneurship could have a significant impact on the economy, given the crucial role entrepreneurs play in job creation and growth.
In a recent study, Ronchi and her coauthors explored whether exposure to entrepreneurs during adolescence could influence the likelihood of starting a company later in life. They analyzed data from Danish population-wide registries, tracking the career paths of nearly one million individuals from adolescence to adulthood. The researchers found that early exposure to entrepreneurs had a positive impact, particularly for girls.
Girls who had exposure to entrepreneurs during their teenage years were more likely to continue their education after compulsory school and had a lower risk of holding low-wage jobs throughout their careers. Additionally, those who pursued entrepreneurial ambitions created more successful and women-friendly companies than the average entrepreneur.
The study focused on the critical period between 13 to 16 years old, a time when Danish teenagers make pivotal decisions about their future education and career paths. By analyzing data from employer-employee registers, education registers, and demographic registers, the researchers were able to measure the long-term impact of exposure to entrepreneurship on career trajectories.
Girls with early exposure to entrepreneurs were more likely to pursue vocational education, the path most conducive to entrepreneurship in Denmark. They were also less likely to be employed in low-paying jobs. Interestingly, girls were only influenced by the entrepreneur status of their female peers’ parents, indicating the importance of same-gender interactions and family connections.
The researchers estimated that girls were 4% more likely to start their own business by age 35 when a higher percentage of their female classmates had entrepreneur parents. Girls who had an entrepreneur parent were also significantly more likely to become entrepreneurs themselves. The businesses of women with early exposure to entrepreneurs outperformed those of their counterparts, employing more people and lasting longer.
The study suggests that early exposure to entrepreneurship can reduce barriers for women in starting and succeeding in their own businesses. It provides valuable sector-specific knowledge and skills, lowers the barrier of entry into entrepreneurship, and raises awareness of entrepreneurship as a viable career path for girls. Overall, the findings highlight the importance of early exposure to entrepreneurs in shaping the career trajectories of women and the success of their businesses.
