Entrepreneurship and individual remuneration. Does it pay to be an entrepreneur?

Seminar paper from the year 2016 in the subject Business economics - Miscellaneous grade: 10 Humboldt-University of Berlin (Chair of Entrepreneurial and Behavioral Decision Making) course: Innovative Entrepreneurship language: English abstract: This literature overview examines five studies investigating the monetary returns to entrepreneurship compared to wage employment. It starts with a summary of findings up to 2007 by observing a meta study and follows by analyzing four recent empirical analyses. These apply various approaches to discover the link between entrepreneurship and individual remuneration: investigating returns to ability comparing twins using a broad definition of entrepreneurship and correcting for underreporting. The results do not indicate a clear direction. Negative positive and similar returns for entrepreneurs compared to employed individuals are found. However if one assumes the problems of a restrictive definition of entrepreneurship and of income underreporting to be generally relevant higher earnings of entrepreneurs seem plausible.