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Entrepreneurship among the Unemployed: the Effect of Unemployment Benefit

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  • Xu, Wenjian

Abstract

This paper probes the drivers and constraints that affect an unemployed individual's decision to start a business. Using linear probability model and survival analysis, we find that unemployment benefits have a significantly negative effect on switching from unemployment to self-employment and a positive effect on the duration before the switch, especially on the unincorporated self-employment. Moreover, unemployed individuals are less likely to start a business after being laid off, if their spouse does not have a job or most people expect the unemployment rate to go down in the coming 12 months.

Suggested Citation

  • Xu, Wenjian, 2018. "Entrepreneurship among the Unemployed: the Effect of Unemployment Benefit," SocArXiv 5dahz, Center for Open Science.
    • Handle: RePEc:osf:socarx:5dahz
    DOI: 10.31219/osf.io/5dahz
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    References listed on IDEAS

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