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The Effect of Relative Standing on Considerations about Self-Employment

  • Stefan Schneck

This paper uses unique German data to examine the effects of the relative standing on the individual propensity to become self-employed in the next two years. The results suggest that the relationship between relative wage positions and propensity to become self-employed is U-shaped. This is interpreted as evidence that low status translates into entrepreneurial motivation for workers in low relative wage positions. Employees with high relative standing, in turn, seem to be more concerned about the lack of future career prospects in paid employment and consider self-employment as a next step on the individual career ladder.

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File URL: http://www.diw.de/documents/publikationen/73/diw_01.c.391496.de/diw_sp0426.pdf
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Paper provided by DIW Berlin, The German Socio-Economic Panel (SOEP) in its series SOEPpapers on Multidisciplinary Panel Data Research with number 426.

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Length: 37 p.
Date of creation: 2011
Date of revision:
Handle: RePEc:diw:diwsop:diw_sp426
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  2. Boden, Richard Jr., 1996. "Gender and self-employment selection: An empirical assessment," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 25(6), pages 671-682.
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  14. Hamermesh, Daniel S, 1975. "Interdependence in the Labour Market," Economica, London School of Economics and Political Science, vol. 42(168), pages 420-29, November.
  15. Barton H. Hamilton, 2000. "Does Entrepreneurship Pay? An Empirical Analysis of the Returns to Self-Employment," Journal of Political Economy, University of Chicago Press, vol. 108(3), pages 604-631, June.
  16. Freeman, Richard B, 1978. "Job Satisfaction as an Economic Variable," American Economic Review, American Economic Association, vol. 68(2), pages 135-41, May.
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