Mobility Maintenance: Intergenerational Social Mobility and Entrepreneurial Entry

Increasing evidence shows that social class affects the propensity to pursue entrepreneurial opportunities. However, entrepreneurship research has either focused on the impact of social class during childhood or the effects of the current social class while neglecting movements between social classes (i.e., social mobility). While higher social class positions facilitate entrepreneurial entry, we argue that mobility maintenance, especially avoiding the loss of job and wage stability, explains why the upwardly mobile are less likely to become entrepreneurs. We explore under which conditions social mobility affects entrepreneurial entry. Based on longitudinal data on 21,960 individuals, we demonstrate that, while higher social class is positively associated with entrepreneurial entry, upwardly mobile individuals, when compared to immobile individuals, are less likely to enter entrepreneurship. Contrary to common assumptions in the literature on family backgrounds, we find that having entrepreneurial parents reinforces this relationship. We attribute this to upwardly mobile individuals’ tendencies to dissociate from their parents’ social class.