Earnings, Independence or Unemployment: Why Become Self-Employed?
AbstractThis paper attempts to estimate the role played by three key variables--expected earnings, the desire for independence, and the ability to find paid employment--on the paid employee/self-employment decision using a simple three-stage utility maximization model. The empirical results suggest that individuals are attracted to self-employment because of higher expected earnings relative to paid employment and by the freedom from managerial constraints that it offers. Evidence is also produced supporting the prosperity pull argument for self-employment. Marital status, parents' employment status, housing equity, and occupational status clearly emerge as significant determinants of labor-market choice. Copyright 1996 by Blackwell Publishing Ltd
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Bibliographic InfoArticle provided by Department of Economics, University of Oxford in its journal Oxford Bulletin of Economics & Statistics.
Volume (Year): 58 (1996)
Issue (Month): 2 (May)
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Web page: http://www.blackwellpublishing.com/journal.asp?ref=0305-9049
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Other versions of this item:
- Taylor, Mark P., 1994. "Earnings, independence or unemployment: why become self -employed?," ISER Working Paper Series 26, Institute for Social and Economic Research.
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