Many studies on the relationship between human capital and entrepreneurial performance either rely on correlations or are confined to developing countries. This paper is the first to review experimental and quasi-experimental studies from industrialized countries. We identify N = 21 papers published before 2017 about the effects of human capital interventions on entrepreneurial performance. Interventions include formal education, business training and entrepreneurship education. Performance outcomes include firm profits, firm employment and entrepreneurial earnings. The mainfindings are that the interventions have weak effects, which are often statistically insignificant. Formal education appears to be the only intervention to have a positive effect on firm profits and entrepreneurial earnings. Evidence is inconclusive regarding effect heterogeneity and effect duration. We conclude that correlational studies tend to overestimate the effects of human capital interventions. Moreover, our calculations suggest that the interventions are associated with substantial deadweight loss.
Keywords: Entrepreneurship Returns to education Firm performance Causal inference
JEL classication: I26 J24 L25 L26 M13 M53