Are Self-Employed Really Happier Than Employees? An Approach Modelling Adaptation and Anticipation Effects to Self-Employment and General Job Changes
AbstractEmpirical analyses using cross-sectional and panel data found significantly higher levels of job satisfaction for self-employed than for employees. We argue that those estimates in previous studies might be biased by neglecting anticipation and adaptation effects. For testing we specify several models accounting for anticipation and adaptation to self-employment and job changes. Based on data from the German Socio-Economic Panel Survey (SOEP) we find that becoming self-employed is associated with large negative anticipation effects. In contrast to recent literature we find no specific long term effect of self-employment on job satisfaction. Accounting for anticipation and adaptation to job changes in general, which includes changes between employee jobs, reduces the effect of self-employment on job satisfaction by 70%. When controlling for anticipation and adaptation to job changes, we find no further anticipation effect of self-employment and a weak positive but not significant effect of self-employment on job satisfaction for three years. Thus adaptation wipes out higher satisfaction within the first three years being self-employed. According to our results previous studies at least overestimated possible positive effects of self-employment on job satisfaction.
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Bibliographic InfoPaper provided by Research Institute on Professions (Forschungsinstitut Freie Berufe (FFB)), LEUPHANA University Lüneburg in its series FFB-Discussionpaper with number 88.
Length: 36 pages
Date of creation: Mar 2011
Date of revision:
job satisfaction; self-employment; hedonic treadmill model; adaptation; anticipation; fixed-effects panel estimations; German Socio-Economic Panel (SOEP);
Other versions of this item:
- Dominik Hanglberger & Joachim Merz, 2011. "Are Self-Employed Really Happier than Employees?: An Approach Modelling Adaptation and Anticipation Effects to Self-Employment and General Job Changes," SOEPpapers on Multidisciplinary Panel Data Research 376, DIW Berlin, The German Socio-Economic Panel (SOEP).
- Hanglberger, Dominik & Merz, Joachim, 2011. "Are Self-Employed Really Happier Than Employees? An Approach Modelling Adaptation and Anticipation Effects to Self-Employment and General Job Changes," IZA Discussion Papers 5629, Institute for the Study of Labor (IZA).
- J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
- J28 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Safety; Job Satisfaction; Related Public Policy
- J81 - Labor and Demographic Economics - - Labor Standards - - - Working Conditions
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-05-14 (All new papers)
- NEP-ENT-2011-05-14 (Entrepreneurship)
- NEP-HAP-2011-05-14 (Economics of Happiness)
- NEP-HRM-2011-05-14 (Human Capital & Human Resource Management)
- NEP-LAB-2011-05-14 (Labour Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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