Does it pay to be a Jack-of-all-trades?

Abstract

Ed Lazear has suggested that because entrepreneurs perform many tasks they must be jackof-all-trades. The theory predicts that entrepreneurs should be generalists and those who work for others should be specialists. We evaluate the relationship between general experience and the choice of self-employment, owning multiple businesses, the probability of commercializing inventions, as well its relationship to income. Data from a survey of 780 inventors and 300 individuals from the general population confirm only one aspect of the theory: entrepreneurs typically have more varied labor market experience. However, the more varied their experience the lower their household income. Results instead support the “hobo syndrome” – that there is heterogeneity in tastes for skills variety.