This article proposes a simultaneous probit equation framework
to analyse the business ownership patterns of married couples in the
United States. A structural model of knowledge spillovers within couples is formulated and estimated. We find evidence consistent with
positive knowledge transfers between members of couples, but little
support for alternative explanations based on assortative mating, role
model, risk diversification, and wealth transfer effects. We conclude
that the conventional practice of ignoring interdependence can generate
misleading conclusions about the determinants of business ownership
in America. |