What types of homeowners are more likely to be entrepreneurs? The evidence from China

This paper highlights a previously undocumented observation regarding the heterogeneity of the association between entrepreneurship and homeownership across ownership through different pathways. Our empirical work based on large individual-level microdata from China’s Urban Household Survey (UHS) suggests that, while owners of market housing do not differ much from renters in terms of the odds of entrepreneurship entry, owners of privatized public housing are associated with significantly less propensity for entrepreneurial engagement and owners of inherited housing are correlated with a much higher prevalence of entrepreneurship. In addition, our empirical findings suggest that the associations between homeownership and entrepreneurial engagement vary with housing value. These findings remain consistent across a wide variety of model specifications, including models controlling for the potential endogeneity between homeownership and entrepreneurship. We provide some preliminary rationalization of these findings and discuss their policy implications.