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The skill balancing act: when does broad expertise pay off?

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  • Elisabeth Bublitz
  • Florian Noseleit

Abstract

We compare skill sets of employees working in businesses of different size to the skill sets of entrepreneurs. Employees in large businesses tend to have a lower skill balance than those working in small businesses; yet, the skill balance of entrepreneurs remains the largest. Our evidence suggests that the skill level and skill scope matter for balance and increase with formal education levels but decrease with the number of previous occupations. We find a positive relationship between skill balance and income that is strongest for entrepreneurs. For employees, the relationship remains positive but the magnitude of the association decreases when business size increases. Copyright Springer Science+Business Media New York 2014

Suggested Citation

  • Elisabeth Bublitz & Florian Noseleit, 2014. "The skill balancing act: when does broad expertise pay off?," Small Business Economics, Springer, vol. 42(1), pages 17-32, January.
    • Handle: RePEc:kap:sbusec:v:42:y:2014:i:1:p:17-32
    DOI: 10.1007/s11187-013-9474-z
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    References listed on IDEAS

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    More about this item

    Keywords

    Entrepreneurship; Balanced skills; Firm size; Division of labor; L22; L26; J24; J31; M13;
    All these keywords.

    JEL classification:

    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups

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