anticipated monetary policy in canada some new evidence abstract in this note i examine the policy ineffectiveness proposition for canada using monthly income data due to milbourne et al 1988 i find that anticipated monetary policy altered the evolution of real output in canada recent work by ambler and phaneuf 1988 can be used to attribute this result to a purely new keynesian model of the business cycle although this inference is found to be fragile with respect to the choice of the level of significance used in the hypothesis tests

why do entrepreneurs leave the market an explanation from experimental economics in peru understanding the behavior of those who start or intend to start a business is vital for a country of entrepreneurs such as peru which registered the third highest rate of active entrepreneurship worldwide in 2011 according to the global entrepreneurship monitor gem however peru also registered in 2011 one of the highest business discontinuation rates among efficiency based and resource based economies this study represents the first effort to analyze certain behavioral characteristics risk aversion joy of winning overconfidence and tax collection of a sample of necessity driven entrepreneurs in lima peru these features might help explain in the first place the decision to become entrepreneurs but also the decision to leave the market in particular wefind that entrepreneurs are risk averse tend to overestimate their abilities and are willing to work harder when the gross pay is higher and are taxed than when it is lower and are not taxed altogether these traits may explain the high discontinuation rate of businesses in peru one of the highest in efficiency based and resource based economies

on the co movement between coffee and cocoa prices in international markets in this article we study the movement between cocoa and coffee prices two close substitute commodities using the ardl approach developed by pesaran et al 2001 we found that the two prices are cointegrated the long run elasticity of coffee price with respect to the cocoa one is estimated at 0 88 also using the lag augmented var approach of toda and yamamoto 1995 which is valid whatever the order of integration of the data the cocoa price is found to granger cause the coffee price and not vice versa this finding suggests that models aiming at forecasting coffee prices should incorporate cocoa prices as well

testing liquidity constraints in 10 asian developing countries an error correction model approach an error correction model is used to estimate the fraction of consumers who are liquidity constrained in 10 asian developing countries our estimates of the fraction of consumers who are liquidity constrained range between 0 25 and 0 98 we further investigate whether financial liberalization has resulted in the reduction of liquidity constraints in these countries however the results find support for this only in the cases of south korea sri lanka and taiwan

modelling the link between commodity prices and exchange rates the tale of daily data this paper examines daily data on exchange rates and the prices of three commodities traded on the winnipeg commodity exchange the temporal patterns of commodity prices and exchange rates are shown to be similar daily data are significantly non normal with garch models capturing the processes generating the data commodity prices and exchange rates are examined for cointegration using recent tests proposed by johansen and juselius 1990 currency depreciation is shown to granger cause commodity price inflation this information might be useful to central bankers concerned with reducing general price inflation through targeting commodity price inflation it also suggests that macro events have important effects on commodity markets in canada

is strike behavior cyclical we examine cyclicality of strike frequency and incidence using canadian data on strikes and contracts total strike frequency exhibits significant procyclicality to which within contract strikes contribute appreciably evidence is weaker for procyclical behavior of contract expiry strikes both in total and disaggregated by issue strike incidence is also procyclical particularly in manufacturing though the procyclicality here is confined to strikes over nonwage issues these results mirror those obtained by analyzing the frequency of strikes in the contract data industry specific cyclical variables positively affect strike incidence in manufacturing but region specific variables have no effect

estimating shocks and impulse response functions this paper examines the issue of how to identify the shocks in a cointegrated var when the following assumptions are made the variables can be classified as endogenous or exogenous there are as many cointegrating relations as endogenous variables the cointegrating vectors are identified and they contain at least one exogenous variable it is shown that with these assumptions it is possible to identify the shocks without the use of further restrictions on the covariance matrix of the disturbances or the short run dynamics if the long run parameters are known the whole model can be estimated by ols the analysis is extended to allow the var to have both stationary and non stationary variables an illustration of the method is provided using the traditional benchmark var model involving us data on output prices interest rates and money a liquidity effect is not found using this var methodology

reference point formation and new venture creation in this study we introduce reference point formation as an important antecedent of new venture creation based on considerations from prospect theory we hypothesize that individuals who generally and consistently set more aspiring reference points have a higher intention to form a new venture testing our hypothesis with entrepreneurs and managers results show that entrepreneurs indeed set more aspiring reference points therefore they might find themselves more often in a perceived loss situation which in turn increases their risk taking behavior following the predictions of prospect theory in testing entrepreneurial intention of business graduate students results are shown to be robust we discuss theoretical and managerial implications of the findings and develop avenues for future research

a dynamic analysis of japanese energy policies their impact on fuel switching and conservation abstract in 1973 the japanese economy was highly dependent on imported oil after the 1973 oil price shock vigorous policy action was undertaken by the japanese government in an attempt to reduce japan s energy consumption and in particular its dependence on imported oil this study attempts to determine how flexibly the japanese economy has responded to the dramatic changes in relative and absolute fuel prices which occurred since 1973 and to what extent government energy policies may have reinforced or undermined market signals and facilitated fuel switching and conservation to analyse the price and income elasticities of energy component demand a dynamic approach to energy demand modelling is employed the study reveals that japanese energy users have responded quite flexibly to the two major oil price rises in the 1970s the probable impact of energy policies on this response is however somewhat problematic

the fallacy of only the strong survive the effects of extrinsic motivation on the persistence decisions for under performing firms abstract under performing firms persist even though existing theoretical perspectives indicate that they should be selected out of the market building upon threshold theory gimeno j folta t cooper a woo c 1997 survival of the fittest entrepreneurial human capital and the persistence of underperforming firms administrative science quarterly 42 750 783 and using staw s staw b m 1981 the escalation of commitment to a course of action academy of management review 6 4 577 587 theoretical model of commitment to a course of action we explore and test the factors that lead entrepreneurs to persist with under performing firms we found environmental munificence personal investment personal options previous organizational success and perceived collective efficacy impact the decision to persist with an under performing firm in addition extrinsic motivation moderates those relationships this research adds to the growing literature on highly persistent under performing firms and complements and extends threshold theory

entrepreneurial exit as a critical component of the entrepreneurial process theoretical development abstract by demonstrating the importance of entrepreneurial exit to the entrepreneur the firm the industry and the economy i contend that our understanding of the entrepreneurial process is incomplete without the inclusion of entrepreneurial exit i define entrepreneurial exit and demonstrate how this conceptualization provides concepts that are unique from those addressed by researchers in other domains thus outlining a space for it within the literature in each phase of the entrepreneurial process i explore the development of an exit strategy reasons for exit and options for exit

the development of an infrastructure for entrepreneurship abstract this paper takes a macroperspective of entrepreneurship and focuses on the issues and events involved in constructing an industrial infrastructure that facilitates and constrains entrepreneurship this infrastructure includes 1 institutional arrangements to legitimate regulate and standardize a new technology 2 public resource endowments of basic scientific knowledge financing mechanisms and a pool of competent labor as well as 3 proprietary rd numerous entrepreneurial actors in the public and not for profit sectors play crucial roles it motivates one to examine the different roles played by these actors and how their joint contributions interact to develop and commercialize a new technology this in turn makes it possible to understand how the risk time and cost to an individual entrepreneur are significantly influenced by developments in the overall infrastructure for entrepreneurship it also explains why the entrepreneurs who run in packs will be more successful than those that go it alone to develop their innovations

modelling natural resource scarcity using the error correction approach an error correction framework is used to test the long run hypothesis that prices of natural resources commodities in the united states exhibit scarcity properties from the late nineteenth century to 1988 in the sense that real resource commodity prices have been increasing or following a u shaped pattern introduced by m e slade 1982 the model is formulated to test the validity of the deflation procedure itself along with the scarcity properties results indicate that the model works well as a description of the long term behavior of resources prices and supports the u shaped version of the scarcity hypothesis in a majority of cases an error correction framework is used to test the long run hypothesis that prices of natural resources commodities in the u s exhibit scarcity properties from the late nineteenth century to 1988 in the sense that real resource commodity prices have been increasing or following a u shaped pattern slade 1982 the model is formulated to test the validity of the deflation procedure itself along with the scarcity properties results indicate that the model works well as a description of the long term behaviour of resources prices and supports the u shaped version of the scarcity hypothesis in a majority of cases

social polarisation economic restructuring and welfare state regimes the central argument of this paper is that it is misconceived to view social polarisation of occupational structure and incomes in global cities as either inevitable or as a direct product of econo

symmetric or asymmetric price adjustments in the oil market an empirical analysis of the relations between international and domestic prices in the federal republic of germany 1972 89 abstract this paper investigates how german consumer and wholesale prices for gasoline and light heating oil react to changes in the corresponding rotterdam prices monthly data from 1972 to 1989 are employed and the subperiods of the 1970s 1972 to 1979 and 1980s 1980 1989 are distinguished error correction models are estimated to seperate long run equilibrium relations and short run adjustment processes for the 1980s we find rapid symmetric and full adjustment of the german prices to the rotterdam prices whereas during the 1970s we find some asymmetries and at least for gasoline the adjustment processes took considerably more time

an inverse demand analysis with introduction of quality effects an application to spanish consumption of fruit and vegetables this article analyzes consumer preference for fruit and vegetables when by using time series with socioeconomic characteristics of households there can be seemingly unobserved quality effects which are increased by aggregation the changes in spanish demand for fresh and processed fruit and vegetables over the period 1987 2000 are discussed following previous tests and analyses quantities are taken as predetermined and prices as matching the offer conditions thus quality effects based on the nutritional and or health value of the product are estimated from the error terms associated with the functions of the unit values quality variables are introduced as taste shifters in the inverse demand system laitinen theil model the results show the positive effects of quality differences on the normalized price for the group of products through own quality flexibilities and the negative effects between fresh and processed products through cross quality flexibilities

the relevance of stakeholder theory and social capital theory in the context of csr in smes an australian perspective the concept of business responsibility usually termed as corporate social responsibility csr originated in the early 1930s after the wall street crash of 1929 exposed corporate irresponsibility in large organisations the understanding of csr has evolved since then and its scope has now broadened from mere compliance to corporate laws to active alignment of internal business goals with externally set societal aspirations unfortunately the significance of this multidimensional concept within the small and medium enterprise sme sector has continued to be overshadowed by its application in large and multinational organisations more importantly this has led to the practice of judging smes which are experiencing increasing pressure to engage in social activities as if they are no different from their larger counterparts this study therefore investigates csr from the perspective of smes in australia without any theoretical presumptions and then comments on the relevance and applicability of the two theories that have been commonly used to investigate business responsibility namely stakeholder theory st and social capital theory sct the research findings indicate that csr within the sme sector is more aligned to the fundamentals of sct mainly owing to the unique resource and survival challenges that they face and which are arguably not so pronounced in large organisations

declining discount rates and the fisher effect inflated past discounted future uncertain and persistent real interest rates underpin one argument for using a declining term structure of social discount rates in the expected net present value enpv framework despite being controversial this approach has influenced both the inter agency working group on cost benefit analysis and the uk government s guidelines on discounting we first clarify the theoretical basis of the enpv approach then rather than following previous work which used a single series of u s treasury bond returns we treat nominal interest rates and inflation as co integrated series and estimate the empirical term structure of discount rates via the fisher effect this nests previous empirical models and is more flexible it also addresses an irregularity in previous work which used data on nominal interest rates until 1950 and real interest rates thereafter as we show the real and nominal data have very different time series properties this paper therefore provides a robustness check on previous discounting advice and updated methodological guidance at a time when governments around the world are reviewing their guidelines on social discounting the policy implications are discussed in the context of the social cost of carbon nuclear decommissioning and public health

a survey of some recent econometric methods this survey is written mainly for the applied economist though we hope that the specialist econometrician will find something of interest too our aim has been to try to bring the applied worker as up to date as possible and in the process to improve the quality of applied work by providing access to the latest ideas in econometrics we have tried to describe and explain in a relatively non technical way the main developments that have taken place in the last ten years partly for reasons of space the survey is by no means exhaustive but it does cover a wide range of topics in both time series and cross section analysis among the subjects covered are the followoing the nature of data including integrated and fractionally integrated data four estimation methods maximum likelihood method of moments m estimators and non parametric estimation inference with stationary and integrated regressors a comparison of various model evaluation principles the formulation of models including dynamic specification cointegration and conditional expectations in mean and variance copyright 1989 by royal economic society

regional interest rate pass through in italy this paper estimates the pass through and speed of adjustment of italian regional interest rates to changes in the money market rate for the period 1998q1 2009q4 our main findings suggest that the markup for the lending rates that banks charge are generally higher in the south than in the north moreover our results indicate that the pass through tends to be longer in southern regions we find little evidence supporting the hypothesis of asymmetric adjustment in the lending rates but detect some evidence supporting upward rigidity in the regional deposit rates

optimal hedge ratios at the winnipeg commodity exchange multivariate garch models are employed to estimate time varying hedge ratios for three commodities traded on the winnipeg commodity exchange garch hedge ratios are shown to be superior to those based on the traditional regression approach to calculating the optimal hedge les ratios optimaux de comptant par rapport aux contrats a terme a la bourse de denrees de winnipeg l auteur emploie des modeles multivaries de type garch pour calibrer les ratios optimaux de comptant par rapport aux contrats a terme pour trois denrees transigees a la bourse des denrees de winnipeg ces ratios s averent superieurs a ceux qu on obtient par les methodes de regression traditionnelles

macroeconomic adjustment and private manufacturing investment in turkey a time series analysis despite the drastic switch to market based policies and outward orientation in turkey during the 1980s private investment in manufacturing industry has still not revived after seventeen years of structural adjustment this paper examines the main determinants of private investment in the manufacturing sector and the impacts of structural adjustment particularly financial liberalisation as an integral part of the reform on it the results show that liberalisation policies in financial markets appear to have positive effects by reducing the stringency of quantity constraints on investment while the high interest rates resulting from financial liberalisation had no significant impact on investment macroeconomic instability proxied by the variability of the inflation rate seems to have discouraged investment in manufacturing

determinants of the expected real long term interest rates in the g7 countries the paper investigates which factors determine the expected real long term interest rates of the g7 countries as a whole within a single equation error correction model inflationary expectations are generated using the low frequency component of inflation provided by the hodrick prescott filter a comparison of the calculated expected inflation rates with those resulting from index linked and conventional uk bonds suggests this approach to be appropriate expected real long term interest rates turn out to be influenced positively by real short term interest rates capacity utilization and structural public borrowing

currency devaluation aggregate output and the long run an empirical study abstract this paper estimates the effect of currency devaluation on the aggregate output level in six asian countries using a unique methodology developed by wickens et al 1988 economic journal 189 205 the estimated results suggest that devaluation in general is neutral in the long run in some cases it even can have a contractionary effect

an analysis of the disaggregated manufacturing exports of the asian nies to eec usa and japan this paper examines the export performance of the four asian newly industrialized economics nies by modelling their bilateral export flows to three main oecd blocks the usa japan and the european community our estimated export demand models reveal interesting asymmetries between these three areas of destination which do not emerge from previous aggregate empirical studies of nie export performance

planned behaviour of tourism students entrepreneurial intentions in china this research aims to investigate the influence of planned behaviour and personal variables on entrepreneurial intention in order to explain and improve low entrepreneurial intention among tourism

a proclivity for entrepreneurship abstract despite intensive inquiry relatively little is known about the entrepreneur the central figure in entrepreneurship the question of how an individual who operates his or her own business differs from a corporate manager remains unanswered in addressing this question the primary purpose of this study was to investigate the potential of psychological constructs to predict a proclivity for entrepreneurship the research model includes three classic themes in the literature achievement motivation risk taking propensity and preference for innovation a survey of 767 small business owner managers and corporate managers was assembled from a 20 state region primarily the southeastern united states the participants completed a questionnaire composed of the achievement scale of the personality research form the risk taking and innovation scales of the jackson personality inventory and questions pertaining to numerous individual and organizational variables respondents were first divided into two groups managers and small business owner managers subsequently due to the often cited variations in entrepreneurs the owner managers were further categorized as either an entrepreneur or small business owner using the widely cited carland et al 1984 theoretical definitions entrepreneurs are defined by their goals of profit and growth for their ventures and by their use of strategic planning alternatively small business owners focus on providing family income and view the venture as an extension of their personalities in this study both groups of owner managers were simultaneously compared with managers using hierarchical set multinomial logit regression the results indicated that the psychological constructs are associated with small business ownership but with some important caveats as hypothesized those labeled entrepreneurs were higher in achievement motivation risk taking propensity and preference for innovation than were both the corporate managers and the small business owners this profile of the entrepreneur as a driven creative risk taker is consistent with much of the classic literature concerning the entrepreneur nonetheless not all of the owner managers fit this profile when compared with managers the small business owners demonstrated only a significantly higher risk taking propensity in terms of the constructs studied the small business owners were more comparable to managers than to entrepreneurs in addition to theoretical and methodological implications the results presented here have important implications for small business owner managers of both types a major issue is the connection between the owner s psychological profile and the characteristics of the venture including performance it would appear that psychological antecedents are associated with owner goals for the venture some owners will be more growth oriented than will others and performance should be assessed in light of the owner s aspirations for the venture moreover owners should be aware of their own personality sets including risk preferences which may be more or less suited to different venture circumstances including those with relatively high levels of risk planning in small businesses appears to enhance venture performance research has demonstrated the connections between psychological factors and planning behaviors in small businesses those labeled entrepreneurs in this study have goals of profit and growth and tend to engage in more planning an awareness of these psychological preferences and concomitant attention to planning behaviors have the potential to improve the performance of the venture irrespective of owner aspirations venture teaming is becoming more popular among entrepreneurs balanced venture teams appear to improve the chances of entrepreneurial success timmons 1990 but a common source of conflict among venture team members is inconsistent or ambiguous motives for the new venture awareness of venture partners psychological predispositions in areas such as risk taking could be used to identify and reconcile areas of potential conflict and enhance the planning process in the small firm in sum an individual s awareness of his or her psychological profile provides a number of advantages not only to existing entrepreneurs but also to aspiring entrepreneurs who should assess their perceived entrepreneurial opportunities against the backdrop of their psychological proclivity for entrepreneurship

tests of exchange market efficiency fragile evidence from cointegration tests abstract several recent papers have employed engle and granger 1987 cointegration tests to determine whether or not markets are efficient we use a new test for cointegration due to johansen 1988 to examine market efficiency with respect to the us dollar exchange rates for canadian japanese and west german currencies the fragile nature of the test indications suggests that cointegration methodologies cannot be relied upon to provide reliable evidence on market efficiency

determinants of agriculture s relative decline thailand during economic development agriculture declines as a proportion of aggregate national output a number of theoretical explanations for this phenomenon have been advanced in the economic literature but their relative historical significance has not been clear this paper develops an econometric methodology to analyze this issue and applies it to time series data for thailand the study investigates the importance of relative commodity prices factor endowments and technical progress as explanations for changing sectoral gdp shares of agriculture manufacturing and services it is concluded that the movement in thailand s aggregate factor endowment relative to labor was the most important determinant of agriculture s relative decline

the entrepreneur s character life issues and strategy making abstract although entrepreneurs seem to engage little in formal planning strategy in entrepreneurial firms can exhibit identifiable patterns over time the strategic orientations of such firms are particularly likely to reflect the priorities of their entrepreneurial ceos while researchers have looked at entrepreneurial traits in order to explain business start ups and generic strategies little attention has been paid to possible interactions between entrepreneurs personal characteristics and the strategic options they choose to pursue this study links entrepreneurs strategy making processes to their life issues legacies of their past histories its finding suggests that an entrepreneurial firm will consistently pursue the strategic directions that most reflect the entrepreneur s set of life issues

tax decentralization and local government size this paper investigates the relationship between fiscal federalism and the sizes of local governments while many empirical studies emphasized that grants encourage the growth of local public spending and local taxes constrain it they are more silent regarding the effects of different types of tax autonomy the paper addresses this issue by arguing that tax decentralization as organized on tax bases used only by local governments tax separation rather than on tax base sharing would restrain local public expenditures using an unbalanced panel of oecd countries the key finding is that only property taxes mostly based on a tax separation scheme seem to favor smaller local governments thus while tax decentralization is a necessary condition for limiting the growth of local governments it does not appear sufficient as tax separation schemes among government levels would in fact be required

cointegration and dynamic time series models abstract this paper provides a survey of some of the recent developments in the field of econometric modelling with cointegrated time series in particular we describe the testing and estimation procedures which have become increasingly popular in the recent applied literature in addition to the two stage procedure proposed by engle and granger we consider extensions to the modelling of dynamic models with cointegrated variables such as the estimation of models with multiple cointegration vectors simultaneous systems models with seasonally integrated and cointegrated variables furthermore we illustrate the practical application of the techniques describes in the paper by means of a tutorial data set

gendering the polarisation debate a comment on hamnett s social polarisation economic restructuring and welfare state regimes this note looks at the juxtaposition of a polarising income distribution and a professionalising occupational structure as an account of recent trends in london it suggests that hamnett may read too much occupational upgrading from the data and that he does not tackle adequately the question of earned income polarisation while welfare systems always mediate the relationship between the global and the local esping anderson s welfare state categorisations do not help to explain differences between new york and london gender relations are seen to underpin occupational and income trends in metropolitan areas

personality characteristics of self employed an empirical study this paper is concerned with the personality characteristics of self employed most existing studies on personality characteristics of entrepreneurs concentrate on factors like age educational profile and motivations to become self employed there is a lack of significant empirical findings to claim that entrepreneurs are psychologically different from the general population based on a large sample of 14 846 individuals we compare self employed with the general population and with wage and salary earners we empirically show that entrepreneurs differ from the general population and wage and salary earners in a number of characteristics entrepreneurs are more individually oriented than the rest of the population individual responsibility and effort are distinguishing characteristics when asked about important qualities that children can be encouraged to learn at home entrepreneurs answer that it is important to teach children an ethic of working hard except for the latter characteristic the same holds if we compare self employed with wage and salary earners

risk uncertainty and entrepreneurship evidence from a lab in the field experiment theory predicts that entrepreneurs have distinct attitudes toward risk and uncertainty but empirical evidence is mixed to better understand the unique behavioral characteristics of entrepreneurs and the causes of these mixed results we perform a large lab in the field experiment comparing entrepreneurs to managers a suitable comparison group and employees n 2 288 the results indicate that entrepreneurs perceive themselves as less risk averse than managers and employees in line with common wisdom however when using experimental incentivized measures the differences are subtler entrepreneurs are only found to be unique in their lower degree of loss aversion and not in their risk or ambiguity aversion this combination of results might be explained by our finding that perceived risk attitude is not only correlated to risk aversion but also to loss aversion overall we therefore suggest using a broader definition of risk that captures this unique feature of entrepreneurs their willingness to risk losses this paper was accepted by uri gneezy behavioral economics

the demand for the components of broad money error correction and generalized asset adjustment sytems the distinction between bank and non bank deposits have been blurred over the last decade and this has led to changes in the demand for various types of monetary aggregates thus money demand studies which focus only on one monetary aggregate like m3 currency plus bank deposits without allowing for the altered nature of asset substitutions may lead to wrong inferences about the cause of the growth of the money this paper is concerned with the interactions between the components of broad money currency bank and non bank deposits in the long and short run the long run asset demand equations are specified to encompass the transaction and portfolio motives for demanding money while the short run asset adjustment equations are derived from an underlying dynamic cost minimizing model the short run asset adjustment model is of the error correction form and under certain assumptions is shown to nest the generalized adjustment form the model is applied to the case of australia using both quarterly and

social polarisation or professionalisation another look at theory and evidence on deindustrialisation and the rise of the service sector the debate over whether or not the deindustrialisation of cities is accompanied by the occupational and income polarisation of their working populations has been characterised by some confusion ove

using founder status age of firm and company growth rate as the basis for distinguishing entrepreneurs from managers of smaller businesses abstract this article examined the empirical implications of definitions that distinguish entrepreneurs from managers of smaller businesses based on their founder nonfounder status and their firms ages and growth rates the best distinctions were created using 1 founders 2 younger companies and 3 the combination of founders and younger companies growth indicators did not discriminate well the two founder based distinctions shared a profile of entrepreneurs as running smaller companies with higher return on assets roa than nonentrepreneurial managers having shorter tenure in their positions having previous work experience in the same industry and having higher risk taking propensity the distinction based on age of firm also showed strong ability to discriminate among respondents the field of entrepreneurship has few longer standing controversies than the one surrounding the question of what distinguishes entrepreneurs from nonentrepreneurial managers in trying to separate entrepreneurs from managers of smaller businesses in particular questions exist concerning the key defining differences definitions of entrepreneurship have utilized founder versus nonfounder status company age and company growth rates as distinguishing elements entrepreneurs have been defined by one or more of the following elements being a company founder running a young company and running or desiring to run a high growth company this article tests these elements to see if they provide a clearly differentiated profile of entrepreneurs it uses the founder nonfounder distinction for example to see if this distinction functions well in identifying a number of company financial and personal attributes that associate with founders rather than nonfounders the approach advocated here borrows from configurational theory as it has emerged in the fields of strategic management and organizational theory meyer tsui and hinings 1993 to look for a constellation of variables that group together in depicting entrepreneurs if founder status company age and growth rate are useful definitions of entrepreneurship they should point to a configuration of factors that together comprise a profile of an entrepreneur in predicting what configuration of factors will emerge this article adopts a strategic adaptation perspective low and macmillan 1988 to argue that differences between entrepreneurs and nonentrepreneurs spring from divergent thought processes and personal attributes of individuals who face the question of whether and how to enter business for themselves using the founder nonfounder distinction we view individuals who decide to start a new business rather than buy or manage an existing one as more likely to have previously founded a business have experience in the same industry be higher in risk taking show more type a behavior and be more growth oriented findings from a sample of ceos in the smaller business association of new england indicated that neither of the two tests based on high growth as a definition of entrepreneurial firms proved adept at creating a distinct entrepreneurial profile distinctions based on founder status younger firm status and founder of a younger firm status on the other hand proved effective in creating such profiles dimensions shared by the two founder based definitions of entrepreneurship included company attributes of smaller size and higher roa and ceo attributes of shorter tenure on the job previous experience in the same industry and higher risk taking propensity additional attributes showed in the younger company founder group including company attributes of lower liquidity and higher sales growth and personal attributes of having previously founded a business ranking roa as a high priority and external locus of control the distinction based on younger firm status performed well in discriminating among respondents in this study in addition to sharing several variables with the founder based distinctions it alone identified younger firms ceos as having lower education and type a tendencies and higher expectations of children succeeding them in the business as one implication of these findings knowledge of the profiles may help people who deal with these groups to have a better sense of how to interact with and respond to them the young company founder profile for example presents a picture of a relatively small company experiencing high rates of sales growth squeezing all it can from its assets in the face of high comparative liabilities because the company is young its founder has relatively short tenure but may well have had previous experience in the industry and have previously founded a company personally the founder is a risk taker who is external in locus of control and places high priority on roa if this configuration holds firm in future research those who deal frequently with entrepreneurs such as bankers venture capitalists consultants accountants and lawyers will be able to use a few identifying factors such as founder status and age of firm to draw reasonable inferences about a host of other characteristics of their clients the attempt to profile the entrepreneur in recent years thought to be futile may yet prove viable