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Self-employment as a source of income inequality

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  • Stefan Schneck

    (Institut für Mittelstandsforschung (IfM) Bonn, Global Labor Organization (GLO))

Abstract

It is well known that the self-employed are over-represented at the bottom as well as the top of the income distribution. This paper shifts the focus from the income situation of the self-employed to the distributive effects of a change in self-employment rates. With representative German data and unconditional quantile regression analysis we show that an increase in the proportion of self-employed individuals in the labor force increases income polarization by tearing down floors at the bottom and allowing higher income potentials at the very top of the hourly income distribution. Recentered influence function regression of inequality measures corroborate that self-employment is a source of income inequality in the labor market.

Suggested Citation

  • Stefan Schneck, 2020. "Self-employment as a source of income inequality," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 10(1), pages 45-64, March.
    • Handle: RePEc:spr:eurasi:v:10:y:2020:i:1:d:10.1007_s40821-019-00143-8
    DOI: 10.1007/s40821-019-00143-8
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    Cited by:

    1. Markus M. Grabka, 2021. "Ungleichheit der Haushaltsnettoeinkommen — Trends, Treiber, Politikmaßnahmen," Wirtschaftsdienst, Springer;ZBW - Leibniz Information Centre for Economics, vol. 101(7), pages 508-515, July.
    2. Stefan Schneck, 2023. "Income loss among the self-employed: implications for individual wellbeing and pandemic policy measures," Review of Economics of the Household, Springer, vol. 21(1), pages 37-57, March.
    3. Sarah L Holloway & Helena Pimlott-Wilson, 2021. "Solo self-employment, entrepreneurial subjectivity and the security–precarity continuum: Evidence from private tutors in the supplementary education industry," Environment and Planning A, , vol. 53(6), pages 1547-1564, September.
    4. Smaranda Pantea, 2022. "Self-employment in the EU: quality work, precarious work or both?," Small Business Economics, Springer, vol. 58(1), pages 403-418, January.
    5. Schneck, Stefan, 2021. "Income loss among the self-employed: Implications for individual wellbeing and pandemic policy measures," Working Papers 03/21, Institut für Mittelstandsforschung (IfM) Bonn.

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    More about this item

    Keywords

    Income distribution; Income inequality; Income polarization; Self-employment;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship

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