검색 상세

Entrepreneurial Activity, Risk, and Business Cycle with Non-pecuniary Benefits

초록/요약

This paper studies the effects of risk and non-pecuniary benefits for entrepreneurs on entrepreneurial activities. We find that the level of non-pecuniary benefits is a key determinant of the number of entrepreneurs and its cyclicality in entrepreneurial models associated with risk. First, entrepreneurial risk makes entrepreneurial activity small and procyclical. Second, non-pecuniary benefits make entrepreneurial activity large and countercyclical. In other words, below the cut-off level of benefits, the number of entrepreneurs is strictly procyclical as in Rampini(2004). However, it is strictly countercyclical above the cut-off level. This cut-off is the level of non-pecuniary benefits which offsets the effect of entrepreneurial risk.

more