open access publication

Article, 2023

Employees' entrepreneurial human capital and firm performance

In: Research Policy, ISSN 1873-7625, 0048-7333, Volume 52, 2, Page 104703, 10.1016/j.respol.2022.104703

Contributors (2)

Braunerhjelm, Pontus (0000-0003-0218-7924) (Corresponding author) [1] [2] [3] Lappi, Emma (0000-0002-3950-931X) [4] [5]


  1. [1] Blekinge Institute of Technology
  2. [NORA names: Sweden; Europe, EU; Nordic; OECD]
  3. [2] Royal Institute of Technology
  4. [NORA names: Sweden; Europe, EU; Nordic; OECD]
  5. [3] Swedish Entrepreneurship Forum
  6. [NORA names: Sweden; Europe, EU; Nordic; OECD]
  7. [4] Copenhagen Business School
  8. [NORA names: CBS Copenhagen Business School; University; Denmark; Europe, EU; Nordic; OECD]
  9. [5] Jönköping University
  10. [NORA names: Sweden; Europe, EU; Nordic; OECD]


We introduce a new measure of human capital, defined as employees' former involvement in entrepreneurship. Such entrepreneurial human capital (EHC) complements traditional human capital measures accumulated through work experience and education. Using detailed longitudinal register data, we track the previous years of entrepreneurial experience for the population of employees in Swedish private sector firms. We provide evidence that higher EHC among employees is associated with significantly higher levels of firm productivity. The baseline result implies that a 10 % increase in employees being former entrepreneurs increases firm-level productivity by 3.9 %. Additionally, we provide evidence that heterogeneity in employees' previous entrepreneurial experience (e.g., the reason for entering and exiting entrepreneurship, type of venture, length of entrepreneurial experiences, and relatedness of technology) influences the impact of EHC on productivity. The results are shown to be robust to various estimation techniques, alternative definitions of EHC, and other performance measures.


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