• AEA in the news
  • August 21, 2017

Eponymous Entrepreneurs

A study in the AER found that companies named for their owners perform better.

Jonathan Weiss/Bigstock

The Economist featured a paper that appeared in the June issue of the American Economic Review about companies named for their owners. The paper by Sharon Belenzon, Aaron Chatterji, and Brendan Daley, examined data from a sample of 1.8 million European companies and found that eponymous firms had returns on assets that were 3 percentage points higher than firms not named for their owners. They theorize that entrepreneurs who name a company after themselves are confident enough to stake their reputation on the company’s success. Customers, meanwhile, pick up on this signal and reward firms accordingly.

You can also check out the AEA's video about this paper here.