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What makes an entrepreneur independent? Evidence from time use survey

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  • Hyytinen, Ari
  • Ruuskanen, Olli-Pekka

Abstract

It is a well-documented empirical regularity that it is more satisfying to be self-employed han to work as an employee for an organization. A large part of this difference in job satisfaction is in the literature attributed to the strong perception of independence by the self-employed. In this paper we study people's time use as a source of entrepreneurial independence. By making use of disaggregated sequential microdata on people's time use, we are able to document that the perceived independence hardly derives from more flexible time use : The self-employed work longer effective hours as well as more in the evenings and weekends than the organizationally employed. Albeit being able to time one's work may be a signal of flexibility in time use, the self-employed have less pure leisure and are less frequently absent from work in general and because of sickness on weekdays in particular. Moreover, we document that the self-employed who have small children are more likely to work after 5 p.m., when the communal day-care centers close. On the basis of these findings it is not surpirising that the selfemployed perceive that they are more often than the organizationally employed under time pressure and in hurry.

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Bibliographic Info

Paper provided by The Research Institute of the Finnish Economy in its series Discussion Papers with number 1029.

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Length: 28 pages
Date of creation: 2006
Date of revision:
Handle: RePEc:rif:dpaper:1029

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Keywords: entrepreneurship; allocation of time; job satisfaction;

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  1. Jeff E. Biddle & Daniel S. Hamermesh, 1989. "Sleep and the Allocation of Time," NBER Working Papers 2988, National Bureau of Economic Research, Inc.
  2. David G. Blanchflower, 2000. "Self-Employment in OECD Countries," NBER Working Papers 7486, National Bureau of Economic Research, Inc.
  3. Ruuskanen, Olli-Pekka, . "An Econometric Analysis of Time Use in Finnish Households," ETLA A, The Research Institute of the Finnish Economy, number 41.
  4. Parker,Simon C., 2006. "The Economics of Self-Employment and Entrepreneurship," Cambridge Books, Cambridge University Press, number 9780521030632.
  5. Carrington, William J & McCue, Kristin & Pierce, Brooks, 1996. "The Role of Employer-Employee Interactions in Labor Market Cycles: Evidence from the Self-Employed," Journal of Labor Economics, University of Chicago Press, vol. 14(4), pages 571-602, October.
  6. Klevmarken, N. Anders, 2005. "Estimates of a labour supply function using alternative measures of hours of work," European Economic Review, Elsevier, vol. 49(1), pages 55-73, January.
  7. Barton H. Hamilton, 2000. "Does Entrepreneurship Pay? An Empirical Analysis of the Returns to Self-Employment," Journal of Political Economy, University of Chicago Press, vol. 108(3), pages 604-631, June.
  8. Tobias J. Moskowitz & Annette Vissing-Jorgensen, 2002. "The Returns to Entrepreneurial Investment: A Private Equity Premium Puzzle?," NBER Working Papers 8876, National Bureau of Economic Research, Inc.
  9. Klevmarken, Anders, 1998. "Microeconomic Analysis of Time-use Data. Did we reach the promised land?," Working Paper Series 1998:12, Uppsala University, Department of Economics.
  10. Blanchflower, David G & Oswald, Andrew J, 1998. "What Makes an Entrepreneur?," Journal of Labor Economics, University of Chicago Press, vol. 16(1), pages 26-60, January.
  11. Tobias J. Moskowitz & Annette Vissing-Jørgensen, 2002. "The Returns to Entrepreneurial Investment: A Private Equity Premium Puzzle?," American Economic Review, American Economic Association, vol. 92(4), pages 745-778, September.
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