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Early-life exposure to hardship increased risk tolerance and entrepreneurship in adulthood with gender differences

Author

Listed:
  • Junjian Yi

    (a National School of Development, Peking University, Beijing, 100871 China;)

  • Junhong Chu

    (b National University of Singapore Business School, National University of Singapore, 119245 Singapore)

  • I. P. L. Png

    (b National University of Singapore Business School, National University of Singapore, 119245 Singapore)

Abstract

We investigate the effect of hardship on entrepreneurship using China’s Great Famine as a quasinatural experiment. This yielded robust evidence that individuals who experienced more hardship were subsequently more likely to become entrepreneurs. Importantly, the increase in entrepreneurship was at least partly due to conditioning rather than selection. Regarding the behavioral mechanism, hardship was associated with greater risk tolerance among men and women but conditioned business ownership only among men. The gender differences were possibly due to a Chinese social norm that men focus on market work and women focus on domestic work combined with interspousal risk pooling in occupational choice.

Suggested Citation

  • Junjian Yi & Junhong Chu & I. P. L. Png, 2022. "Early-life exposure to hardship increased risk tolerance and entrepreneurship in adulthood with gender differences," Proceedings of the National Academy of Sciences, Proceedings of the National Academy of Sciences, vol. 119(15), pages 2104033119-, April.
    • Handle: RePEc:nas:journl:v:119:y:2022:p:e2104033119
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    Citations

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    Cited by:

    1. Cheng, Zhiming & Smyth, Russell & Zhang, Le, 2024. "Does childhood adversity affect household portfolio decisions? Evidence from the Chinese Great Famine," China Economic Review, Elsevier, vol. 87(C).
    2. Hayward, Mathew & Cheng, Zhiming & Zhe Wang, Ben, 2022. "Disrupted education, underdogs and the propensity for entrepreneurship: Evidence from China’s sent-down youth program," Journal of Business Research, Elsevier, vol. 151(C), pages 33-39.
    3. Wei, Binhui & Wang, Runtao & Lin, Xiakaifeng & Zhao, Chunkai & Luo, Mingzhong, 2024. "The long-term effect of childhood left-behind experiences on entrepreneurial activities in adulthood: Empirical evidence from China," Children and Youth Services Review, Elsevier, vol. 164(C).
    4. Hayward, Mathew & Cheng, Zhiming & Wang, Haining & Smyth, Russell, 2023. "Parental influence and the propensity for entrepreneurship: Evidence from the one-child policy," Journal of Business Venturing Insights, Elsevier, vol. 20(C).
    5. Huang, Bin & Wang, Bin & Chen, Zixuan, 2024. "Individual investment adaptations to COVID-19 lockdowns," The North American Journal of Economics and Finance, Elsevier, vol. 70(C).
    6. Wang, Xiaolu & Chen, Qihui & Zhu, Chen, 2022. "How Individual’s Early Hunger Experience Impacts Their Future Socioeconomic Status: Evidence from China," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322129, Agricultural and Applied Economics Association.
    7. Awaworyi Churchill, Sefa & Smyth, Russell & Trinh, Trong-Anh, 2023. "Negative life events and entrepreneurship," Journal of Business Research, Elsevier, vol. 155(PB).

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