Effects of Human Capital and Social Capital on Entrepreneurial Activity

Abstract

We use a knowledge-based perspective in examining the effects of individuals’ human capital and social capital on the likelihood to engage in new venture creation. Our analyses are based on data collected for the 2002 Global Entrepreneurship Monitor. More specifically, we analyzed data from 4536 individuals (living in Belgium or Finland) in terms of their education and skills, and their contacts with the entrepreneurial community. We found that skills specific to the start-up process and knowing an existing entrepreneur increase the likelihood the launch a new venture. We discuss our findings and provide directions for future research.