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Papers written by Author(s): 'Xiao Cen'

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  • Working Paper

    Household Wealth and Entrepreneurial Career Choices: Evidence from Climate Disasters

    July 2024

    Authors: Xiao Cen

    Working Paper Number:

    CES-24-39

    This study investigates how household wealth affects the human capital of startups, based on U.S. Census individual-level employment data, deed records, and geographic information system (GIS) data. Using floods as a wealth shock, a regression discontinuity analysis shows inundated residents are 7% less likely to work in startups relative to their neighbors outside the flood boundary, within a 0.1-mile-wide band. The effect is more pronounced for homeowners, consistent with the wealth effect. The career distortion leads to a significant long-run income loss, highlighting the importance of self-insurance for human capital allocation.
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