Why leave wage work and become self-employed ? Independence, earnings or unemployment
AbstractThe paper addresses the problem of the relation between self-employment and employee status. The issue is whether self-employment is a form of disguised unemployment or a suitable long term form of employment towards which gravitate the most successful wage-workers: wage-workers attracted by an activity that is more independent and more apt to bring their personality to the foreground. The paper focuses on a detailed study of previous experience as an employee (entrance, duration, mobility, status, firm’s size) to evaluate this point. Individuals enter self-employment for the first time at a very young age, and the choice is the result of a period of high mobility, unemployment and inactivity after the first entrance into the labour market as an employee. Self-employment does not seem to be bound by a liquidity constraint or by the need to accumulate assets in order to start a viable businesses, the usual reasons brought about to explain deferred entry, or by the time necessary to discover a viable business opportunity: it is directly linked to movements in wage employment and represents a temporary solution to face an unattended negative shock.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 10780.
Date of creation: Mar 1999
Date of revision:
Unemployment; Self-emeplyment; Transitions in the Labour Market;
Find related papers by JEL classification:
- J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
- J82 - Labor and Demographic Economics - - Labor Standards - - - Labor Force Composition
- R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
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