What happens to nascent entrepreneurs? An econometric analysis of the PSED

This article follows the progress of a large and nationally representative sample of American nascent entrepreneurs - identified in the initial interview of the Panel Study of Entrepreneurial Dynamics (PSED) - over the next 12 months of the panel. We develop a novel theoretical framework based on maximisation of expected utility and the value of waiting, and estimate it to reveal which personal and economic characteristics are associated with venture start-up - and which are associated with remaining a nascent entrepreneur, or giving up entirely. The value of waiting turns out to play a key role in helping us understand what happens to nascent entrepreneurs. We discuss the implications of our results for entrepreneurs, lenders, business start-up support agencies and policy-makers.