"Liberalizing home-based business" by Sumit AGARWAL, Tien Foo SING et al.
 

Publication Type

Journal Article

Version

acceptedVersion

Publication Date

12-2024

Abstract

Working at home benefits entrepreneurs by lowering fixed costs and allowing them to engage in joint market and household production. We evaluate a large-scale reform in Singapore, the Home Office Scheme, that allowed business creation at one's residential property and study whether home-based entrepreneurship spurs entrepreneurial activities. The difference-in-differences estimate shows that the reform led to a significantly higher level of business creation and that the firms newly created in response to the reform had a higher survival rate. The effect is more pronounced for low-income female individuals and industries with high startup capital, implying that financial constraints and nonpecuniary benefits likely drive the effect. The reform also encourages entrepreneurs to become serial entrepreneurs, and they open a larger business with a similar survival rate for their second firm. Overall, our findings suggest that the program effectively attracted more entry into self-employment without significantly lowering the average quality of the pool.

Keywords

Entrepreneurship, Home-Base Work, Experimentation, Singapore

Discipline

Asian Studies | Entrepreneurial and Small Business Operations

Research Areas

Finance

Publication

Management Science

Volume

70

Issue

12

First Page

8301

Last Page

8321

ISSN

0025-1909

Identifier

10.1287/mnsc.2021.04232

Publisher

Institute for Operations Research and Management Sciences

Copyright Owner and License

Authors

Additional URL

https://doi.org/10.1287/mnsc.2021.04232

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