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The role of Culture on Self-Employment

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  • MIRIAM MARCEN
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    Abstract

    There is an extensive literature examining the determinants of self-employment. These studies have mainly failed to account for the differences in entrepreneurial spirit across countries. This paper explores the role of culture in self-employment by exploiting variation in historical self-employment rates by country of origin of second-generation immigrants. Since second-generation immigrants are born in the U.S., all of them live under American laws and institutions. Thus, we interpret differences in self-employment rates by country of origin as evidence of the effect of culture. Using this epidemiological approach, we find that culture has quantitatively significant effects the self-employment decision.

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    File URL: http://www-sre.wu.ac.at/ersa/ersaconfs/ersa13/ERSA2013_paper_00752.pdf
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    Bibliographic Info

    Paper provided by European Regional Science Association in its series ERSA conference papers with number ersa13p752.

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    Date of creation: Nov 2013
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    Handle: RePEc:wiw:wiwrsa:ersa13p752

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    Keywords: Self-Employment; Culture;

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    1. Douglas Holtz-Eakin & David Joulfaian & Harvey S. Rosen, 1993. "Sticking it Out: Entrepreneurial Survival and Liquidity Constraints," NBER Working Papers 4494, National Bureau of Economic Research, Inc.
    2. Antecol, Heather, 2000. "An examination of cross-country differences in the gender gap in labor force participation rates," Labour Economics, Elsevier, vol. 7(4), pages 409-426, July.
    3. Herb J. Schuetze, . "Taxes, Economic Conditions And Recent Trends in Male Self-Employment: A Canada-U.S. Comparison," Canadian International Labour Network Working Papers 11, McMaster University.
    4. Davis, Steven J & Haltiwanger, John & Schuh, Scott, 1996. " Small Business and Job Creation: Dissecting the Myth and Reassessing the Facts," Small Business Economics, Springer, vol. 8(4), pages 297-315, August.
    5. Blanchflower, D.G. & Oswald, A., 1991. "What Makes an Entrepreneur?," Economics Series Working Papers 99125, University of Oxford, Department of Economics.
    6. Lofstrom, Magnus, 1999. "Labor Market Assimilation and the Self-Employment Decision of Immigrant Entrepreneurs," IZA Discussion Papers 54, Institute for the Study of Labor (IZA).
    7. Douglas Holtz-Eakin & David Joulfaian & Harvey S. Rosen, 1994. "Entrepreneurial Decisions and Liquidity Constraints," RAND Journal of Economics, The RAND Corporation, vol. 25(2), pages 334-347, Summer.
    8. Paola Giuliano, 2005. "Living Arrangements in Western Europe: Does Cultural Origin Matter?," 2005 Meeting Papers 189, Society for Economic Dynamics.
    9. Borjas, George J, 1995. "Assimilation and Changes in Cohort Quality Revisited: What Happened to Immigrant Earnings in the 1980s?," Journal of Labor Economics, University of Chicago Press, vol. 13(2), pages 201-45, April.
    10. Borjas, George J & Bronars, Stephen G, 1989. "Consumer Discrimination and Self-employment," Journal of Political Economy, University of Chicago Press, vol. 97(3), pages 581-605, June.
    11. Evans, David S & Jovanovic, Boyan, 1989. "An Estimated Model of Entrepreneurial Choice under Liquidity Constraints," Journal of Political Economy, University of Chicago Press, vol. 97(4), pages 808-27, August.
    12. Blanchflower, David G. & Oswald, Andrew & Stutzer, Alois, 2001. "Latent entrepreneurship across nations," European Economic Review, Elsevier, vol. 45(4-6), pages 680-691, May.
    13. Taylor, Mark P., 1994. "Earnings, independence or unemployment: why become self -employed?," ISER Working Paper Series 26, Institute for Social and Economic Research.
    14. Evans, David S & Leighton, Linda S, 1989. "Some Empirical Aspects of Entrepreneurship," American Economic Review, American Economic Association, vol. 79(3), pages 519-35, June.
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