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Self-employment in Brazil and its determinants: a spatial analysis

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  • Sueli Moro

  • Flavia Chein
  • Ana Flávia Machado

Abstract

In this paper, we intend to identify some factors underlying the different rates of participation of self-employed workers in Brazilian municipalities. In contrast with previous analysis, our study is sensitive to the spatial dimension of self-employment in Brazil. Relying on geo-referenced data from areal units, our approach avoids the restrictive assumptions of independence between area effects. Two different approaches to spatial analysis are exploited, Exploratory Spatial Data Analysis (ESDA) and Spatial Econometrics. We show that substantial geographical heterogeneity in rates of self-employment exists within Brazil. The results point to the presence of clusters of municipalities with similar rates of participation of self-employment in the economy. The fitting of a spatial lag model to the data demonstrates that significant part of variation in self-employment is explained by spatial dependence. In addition, the municipality's degree of urbanization, rate of employment in the secondary sector as well as GDP per capita among others, indeed influences its rate of self-employment. We conclude that spatial analysis can provide useful insights in analyzing self-employment in Brazil.

Suggested Citation

  • Sueli Moro & Flavia Chein & Ana Flávia Machado, 2003. "Self-employment in Brazil and its determinants: a spatial analysis," Textos para Discussão Cedeplar-UFMG td204, Cedeplar, Universidade Federal de Minas Gerais.
    • Handle: RePEc:cdp:texdis:td204
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    File URL: https://www.cedeplar.ufmg.br/pesquisas/td/TD%20204.pdf
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    References listed on IDEAS

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    1. Anselin, Luc & Bera, Anil K. & Florax, Raymond & Yoon, Mann J., 1996. "Simple diagnostic tests for spatial dependence," Regional Science and Urban Economics, Elsevier, vol. 26(1), pages 77-104, February.
    2. Paelinck, J., 1978. "Spatial econometrics," Economics Letters, Elsevier, vol. 1(1), pages 59-63.
    3. Bera, Anil K. & Yoon, Mann J., 1993. "Specification Testing with Locally Misspecified Alternatives," Econometric Theory, Cambridge University Press, vol. 9(4), pages 649-658, August.
    4. Niels G. Noorderhaven & Sander Wennekers & Geert Hofstede & A. Roy Thurik & Ralph E. Wildeman, 1999. "Self-Employment out of Dissatisfaction: An International Study," Tinbergen Institute Discussion Papers 99-089/3, Tinbergen Institute.
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    Cited by:

    1. Olivier Bargain & Prudence Kwenda, 2010. "Is informality bad? Evidence from Brazil, Mexico and South Africa," Working Papers 201003, School of Economics, University College Dublin.
    2. Giuliano Guerra & Roberto Patuelli, 2014. "The influence of role models on immigrant self-employment: a spatial analysis for Switzerland," International Journal of Manpower, Emerald Group Publishing Limited, vol. 35(1/2), pages 187-215, May.

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