Enduring effects or business as usual?

entrepreneurship after bankruptcy

Article

Previous bankruptcy is often seen as sign of poor entrepreneurial skills but few have examined whether renascent entrepreneurs actually perform worse or better upon reentering and how performance differences might be explained. Using a sample of 1,745 Dutch SMEs firms of which 67 were managed by renascent entrepreneurs this study examines potential differences in performance between renascent and other firms and explores to what extent this can be attributed to effects of the bankruptcy involvement on embeddedness, innovativeness, ambition and financial discipline.

Non-parametric and multiple mediation analyses were conducted to test a set of hypotheses. Renascent entrepreneurs were found to show better sales level and were more innovative but also indicate more negative growth rates. Further, they show less financial discipline, but do not differ in their overall embeddedness and ambition levels. These mixed findings suggest that previous bankruptcy involvement is not necessarily a clear admission of failure.

Reference Wakkee, I., & Moser , C. (2016). Enduring effects or business as usual? entrepreneurship after bankruptcy. International Journal of Business Environment, 8(3), 217-241. https://doi.org/10.1504/IJBE.2016.079690

Publication date

Jan 2016

Author(s)

Christine Moser

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