April 13, 2006

Much of entrepreneurial drive is genetic, new study finds

Paper co-authored by professor from Weatherhead School of Management shows genetic predisposition toward entrepreneurism

Scott Shane

Entrepreneurs are considered vital to the health of a region's or nation's economy since they create wealth and jobs. And while governments and business groups are always on the lookout for ways to spark entrepreneurship, no one knows precisely what leads people to start their own business. But a new study suggests that a substantial part of the answer can be found in an individual's genetic makeup.

Scott Shane, the Mixon Professor of Entrepreneurial Studies at Case Western Reserve University's Weatherhead School of Management; Nicos Nicolaou, a lecturer in entrepreneurship at the Tanaka School of Business of Imperial College London; and Janice Hunkin, Lynn Cherkas, and Tim Spector of the Twin Research & Genetic Epidemiology Unit at St Thomas' Hospital in London, home of the UK Twin registry of over 10,000 twins collaborated in this unique study. They compared rates of entrepreneurship between and among more than 1,200 pairs of identical and fraternal twins in the U.K and conclude that nearly half—48 percent—of an individual's propensity to become self-employed is genetic.

The authors studied self-employment among 609 pairs of identical twins, and compared it to self-employment among 657 pairs of same-sex fraternal twins in the U.K. Identical twins share 100% of their genetic composition, while fraternal twins share about 50%, on average. Thus differences in the rates at which pairs of identical twins both become entrepreneurs and the rates at which both members of fraternal twins both become entrepreneurs are attributable to genetics. "One can look at the patterns of concordance (the numbers of pairs of twins in which both members are or are not entrepreneurs) and reasonably infer that genetic factors account for the differences," says Shane.

The authors propose several methods by which genetic factors might influence people's tendency to become entrepreneurs. For example, genes may predispose an individual to develop traits such as being sociable and extroverted, which in turn facilitate skills such as salesmanship, which are vital to entrepreneurial success.

In addition, genes have been shown to affect the level of education an individual receives, and more highly educated people are likelier to become entrepreneurs because they are better able to recognize new business opportunities when they arise.

This study shows a clear genetic predisposition toward entrepreneurship and makes it now possible proceed with studies to identify the specific genes involved in being an entrepreneur.

The Case Western Reserve University Weatherhead School of Management is an international center of management scholarship, committed to preparing and enhancing organizational leadership. The Weatherhead School is dedicated to making discoveries of enduring consequence, developing innovative educational programs, fostering strategic partnerships with students and organizations, and providing services to multiple communities.

For more information: Jeff Bendix 216-368-6070.

Posted by: Heidi Cool, April 13, 2006 02:56 PM | News Topics: Collaborations/Partnerships, Research

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