Serial Entrepreneurs and the Macroeconomy

There are enormous differences across firms and their impact on the macroeconomy. Using unique administrative data from Portugal, enabling us to link companies to their owners, we show that firms owned by serial entrepreneurs (owners of multiple businesses) enjoy a "premium" along many dimensions. Serial entrepreneur firms are significantly larger, more productive, less likely to shut down, grow faster and contribute disproportionately to aggregate job creation and productivity growth compared to other businesses. These differences are already apparent among the very first businesses of serial entrepreneurs, suggesting that they are the result of entrepreneurial selection, rather than learning. Finally, we document that individual characteristics of business owners, especially schooling and past wages, can partly explain the "serial entrepreneur premium''. Our results, therefore, highlight the importance of ex-ante firm heterogeneity for macroeconomic outcomes and point towards entrepreneurs as an important source of such heterogeneity