Entrepreneurial human capital and the long-run survival of firms in India

This paper analyses the characteristics of entrepreneurs that contribute to firms' survival in less-developed countries (LDCs). The study, which relies on data collected in a 1971 survey of entrepreneurs in South India and a follow-up survey of surviving firms in 1993, finds that entrepreneurial human capital greatly influences firm survival. The results indicate that firms founded by older entrepreneurs in higher castes are most likely to survive, but that increased education of the founding entrepreneur reduces survival. These results provide evidence that opportunities of entrepreneurs outside the firm, ignored in most theories, are important in firm survival. Copyright (C) 1996 Elsevier Science Ltd