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The relation between public assistance and self-employment in census tracts: a long-term perspective

Author

Listed:
  • Pankaj C. Patel

    (Villanova School of Business, Villanova University)

  • Cornelius A. Rietveld

    (Erasmus University Rotterdam)

  • Jack I. Richter

    (Florida State University)

Abstract

We present evidence on the long-term relationship between the breadth (the proportion of households) and depth (the amount per household) of public assistance and the prevalence of self-employment in US neighbourhoods. The analysis of decennial data of 71,437 census tracts over four decades (1970 to 2000) shows that the poverty ratio lowers self-employment, and that breadth (but not depth) of public assistance mitigates the negative relationship between the poverty ratio and self-employment. The results are robust to alternate model specifications and are informative about the distributional effects of welfare spendings.

Suggested Citation

  • Pankaj C. Patel & Cornelius A. Rietveld & Jack I. Richter, 2022. "The relation between public assistance and self-employment in census tracts: a long-term perspective," Journal of Evolutionary Economics, Springer, vol. 32(3), pages 891-927, July.
    • Handle: RePEc:spr:joevec:v:32:y:2022:i:3:d:10.1007_s00191-021-00746-3
    DOI: 10.1007/s00191-021-00746-3
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