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Falck, Oliver; Wößmann, Ludger (2013): School competition and students’ entrepreneurial intentions: International evidence using historical Catholic roots of private schooling. In: Small Business Economics, Vol. 40, No. 2: pp. 459-478

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School choice research mostly focuses on academic outcomes. Policymakers increasingly view entrepreneurial traits as a non-cognitive outcome important for economic growth. We use international PISA-2006 student-level data to estimate the effect of private-school competition on students’ entrepreneurial intentions, measured by their occupational desire to manage a small enterprise. We exploit Catholic-Church resistance to state schooling in the 19th century as a natural experiment to obtain exogenous variation in current private-school shares. Our instrumental-variable results suggest that a 10%-point higher private-school share raises students’ entrepreneurial intentions by 0. 3-0. 5% points (11-18% of the international mean) even after controlling for current Catholic shares, students’ academic skills, and parents’ entrepreneurial occupation.

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