Scandinavian Working Papers in Economics

Ratio Working Papers,
The Ratio Institute

No 311: Entrepreneurial motivation and idea generation by displaced employees

Emelie Källner and Kristina Nyström ()
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Emelie Källner: Department of Industrial Economics and Management, KTH, The Royal Institute of Technology, Postal: Department of Industrial Economics and Management, KTH, Lindstedv. 30, SE-100 44, Stockholm, Sweden
Kristina Nyström: The Ratio Institute, Postal: The Ratio Institute, P.O. Box 5095, SE-102 42 Stockholm, Sweden, and, Department of Industrial Economics and Management, KTH, , Lindstedv. 30, SE-100 44, Stockholm, Sweden

Abstract: This paper studies the entrepreneurial motivation and idea generation process of displaced employees. The empirical results are based on both quantitative (survey) and qualitative (interviews) data collected from displaced employees who decided to become entrepreneurs after the closure of R&D facilities of the pharmaceutical company AstraZeneca in Lund (2010) and Södertälje (2012), Sweden. The empirical findings show that the previous experience and expertise gained from AstraZeneca greatly influenced the idea generation process. Although the employees were affected by their job displacement, still 70 percent of the entrepreneurial activities could be regarded as opportunity-based, suggesting that many entrepreneurs are driven by a combination of push and pull motives. With regard to the timing of the idea generation process, about one third of the entrepreneurs came up with their business ideas before learning about the facility closures. Hence, in many cases, being affected by the displacement spurred the launch of ideas that already existed.

Keywords: Entrepreneurship; firm closure; firm exit; entrepreneurship after displacement; entrepreneurial idea generation

JEL-codes: J63; L26

38 pages, September 11, 2018

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