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Ethnic origin, local labour markets and self-employment in Sweden: A Multilevel Approach

Author

Listed:
  • Andersson, Lina

    () (Linnaeus University)

  • Hammarstedt, Mats

    () (Linnaeus University)

  • Hussain, Shakir

    () (University of Birmingham)

  • Shukur, Ghazi

    () (Jönköping International Business School & Linnaeus University)

Abstract

We investigate the importance of ethnic origin and local labour markets conditions for self-employment propensities in Sweden. In line with previous research we find differences in the self-employment rate between different immigrant groups as well as between different immigrant cohorts. We use a multilevel regression approach in order to quantify the role of ethnic background, point of time for immigration and local market conditions in order to further understand differences in self-employment rates between different ethnic groups. We arrive at the following: The self-employment decision is to a major extent guided by factors unobservable in register data. Such factors might be i.e. individual entrepreneurial ability and access to financial capital. The individual’s ethnic background and point of time for immigration play a smaller role for the self-employment decision but are more important than local labour market conditions.

Suggested Citation

  • Andersson, Lina & Hammarstedt, Mats & Hussain, Shakir & Shukur, Ghazi, 2011. "Ethnic origin, local labour markets and self-employment in Sweden: A Multilevel Approach," Working Paper Series in Economics and Institutions of Innovation 261, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.
  • Handle: RePEc:hhs:cesisp:0261
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    References listed on IDEAS

    as
    1. Amelie Constant & Klaus Zimmermann, 2006. "The Making of Entrepreneurs in Germany: Are Native Men and Immigrants Alike?," Small Business Economics, Springer, pages 279-300.
    2. Lina Andersson & Mats Hammarstedt, 2010. "Intergenerational transmissions in immigrant self-employment: Evidence from three generations," Small Business Economics, Springer, pages 261-276.
    3. Michael Hout & Harvey Rosen, 2000. "Self-Employment, Family Background, and Race," Journal of Human Resources, University of Wisconsin Press, vol. 35(4), pages 670-692.
    4. Robert W. Fairlie & Bruce D. Meyer, 1996. "Ethnic and Racial Self-Employment Differences and Possible Explanations," Journal of Human Resources, University of Wisconsin Press, pages 757-793.
    5. Fairlie, Robert W, 1999. "The Absence of the African-American Owned Business: An Analysis of the Dynamics of Self-Employment," Journal of Labor Economics, University of Chicago Press, vol. 17(1), pages 80-108, January.
    6. George J. Borjas, 1986. "The Self-Employment Experience of Immigrants," Journal of Human Resources, University of Wisconsin Press, vol. 21(4), pages 485-506.
    7. Mats Hammarstedt & Ghazi Shukur, 2006. "Immigrants' Relative Earnings in Sweden - A Cohort Analysis," LABOUR, CEIS, vol. 20(2), pages 285-323, June.
    8. Clark, Kenneth & Drinkwater, Stephen, 2000. "Pushed out or pulled in? Self-employment among ethnic minorities in England and Wales," Labour Economics, Elsevier, vol. 7(5), pages 603-628, September.
    9. Mats Hammarstedt, 2006. "The predicted earnings differential and immigrant self-employment in Sweden," Applied Economics, Taylor & Francis Journals, vol. 38(6), pages 619-630.
    10. Andrew M. Yuengert, 1995. "Testing Hypotheses of Immigrant Self-Employment," Journal of Human Resources, University of Wisconsin Press, vol. 30(1), pages 194-204.
    11. Parker,Simon C., 2006. "The Economics of Self-Employment and Entrepreneurship," Cambridge Books, Cambridge University Press, number 9780521030632, December.
    12. Mats Hammarstedt, 2004. "Self-Employment Among Immigrants in Sweden -- An Analysis of Intragroup Differences," Small Business Economics, Springer, pages 115-126.
    13. Mats Hammarstedt & Ghazi Shukur, 2009. "Testing the home-country self-employment hypothesis on immigrants in Sweden," Applied Economics Letters, Taylor & Francis Journals, vol. 16(7), pages 745-748.
    14. Lina Andersson & Mats Hammarstedt, 2011. "Transmission of self-employment across immigrant generations: the importance of ethnic background and gender," Review of Economics of the Household, Springer, vol. 9(4), pages 555-577, December.
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    Cited by:

    1. Alberto Díaz Dapena & Fernando Rubiera Morollón & Dusan Paredes Araya, 2014. "Are there different convergence local behaviors hidden under the regional level? An analysis for the US States and counties with multilevel approach," Documentos de Trabajo en Economia y Ciencia Regional 47, Universidad Catolica del Norte, Chile, Department of Economics, revised Jul 2017.
    2. 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.
    3. Isidoro Romero & Zhikun Yu, 2015. "Analyzing the influence of social capital on self-employment: a study of Chinese immigrants," The Annals of Regional Science, Springer;Western Regional Science Association, pages 877-899.

    More about this item

    Keywords

    Self-employment; immigrant background; local labour market;

    JEL classification:

    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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