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Occupational Choice and Self-Employment: Are They Related?

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  • Alina Sorgner
  • Michael Fritsch

Abstract

Often, a person will become an entrepreneur only after a period of dependent employment, suggesting that occupational choices precede entrepreneurial choices. We investigate the relationship between occupational choice and self-employment. The findings suggest that the occupational choice of future entrepreneurs at the time of labor market entry is partly guided by a taste for skill variety, the prospect of high. - earnings, and occupational earnings risk. Entrepreneurial intentions may also emerge after gaining work experience in a chosen occupation. We find that occupations characterized by high levels of unemployment and earnings risk, relatively many job opportunities, and high self-employment rates foster the founding of an own business. Also, people who fail to achieve an occupation-specific income have a tendency for selfemployment.

Suggested Citation

  • Alina Sorgner & Michael Fritsch, 2013. "Occupational Choice and Self-Employment: Are They Related?," SOEPpapers on Multidisciplinary Panel Data Research 533, DIW Berlin, The German Socio-Economic Panel (SOEP).
  • Handle: RePEc:diw:diwsop:diw_sp533
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    Cited by:

    1. Alfredo Monte & Luca Pennacchio, 2020. "Historical roots of regional entrepreneurship: the role of knowledge and creativity," Small Business Economics, Springer, vol. 55(1), pages 1-22, June.
    2. Pankaj C. Patel & Cornelius A. Rietveld & Ingrid Verheul, 2021. "Attention Deficit Hyperactivity Disorder (ADHD) and Earnings in Later-Life Self-Employment," Entrepreneurship Theory and Practice, , vol. 45(1), pages 43-63, January.
    3. Sorgner, Alina & Fritsch, Michael, 2013. "Stepping Forward: Personality Traits, Choice of Profession, and the Decision to Become Self-Employed," VfS Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79768, Verein für Socialpolitik / German Economic Association.
    4. Mathias Kloss & Thomas Kirschstein & Steffen Liebscher & Martin Petrick, 2019. "Robust Productivity Analysis: An application to German FADN data," Papers 1902.00678, arXiv.org, revised Feb 2019.
    5. Klaesson, Johan & Larsson, Johan P, 2014. "Education and Self-employment Propensity," Working Paper Series in Economics and Institutions of Innovation 345, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.
    6. Michael Fritsch & Alina Sorgner, 2013. "Entrepreneurship and Creative Professions: A Micro-Level Analysis," SOEPpapers on Multidisciplinary Panel Data Research 538, DIW Berlin, The German Socio-Economic Panel (SOEP).
    7. Nadia Simoes & Nuno Crespo & Sandrina B. Moreira, 2016. "Individual Determinants Of Self-Employment Entry: What Do We Really Know?," Journal of Economic Surveys, Wiley Blackwell, vol. 30(4), pages 783-806, September.
    8. Robert P. Garrett & Chao Miao & Shanshan Qian & Tae Jun Bae, 2017. "Entrepreneurial spawning and knowledge-based perspective: a meta-analysis," Small Business Economics, Springer, vol. 49(2), pages 355-378, August.
    9. Cowling, Marc & Millán, José María & Yue, Wei, 2019. "Two decades of European self-employment: Is the answer to who becomes self-employed different over time and countries?," Journal of Business Venturing Insights, Elsevier, vol. 12(C).

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    More about this item

    Keywords

    Entrepreneurial choice; occupation-specific determinants of entrepreneurship; risk preferences; taste for variety;
    All these keywords.

    JEL classification:

    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • D1 - Microeconomics - - Household Behavior

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