Are Self-Employed Really Happier Than Employees? An Approach Modelling Adaptation and Anticipation Effects to Self-Employment and General Job Changes
Empirical analyses using cross-sectional and panel data found significantly higher levels of job satisfaction for self-employed than for employees. We argue that those estimates in previous studies might be biased by neglecting anticipation and adaptation effects. For testing we specify several models accounting for anticipation and adaptation to self-employment and job changes. Based on data from the German Socio-Economic Panel Survey (SOEP) we find that becoming self-employed is associated with large negative anticipation effects. In contrast to recent literature we find no specific long term effect of self-employment on job satisfaction. Accounting for anticipation and adaptation to job changes in general, which includes changes between employee jobs, reduces the effect of self-employment on job satisfaction by 70%. When controlling for anticipation and adaptation to job changes, we find no further anticipation effect of self-employment and a weak positive but not significant effect of self-employment on job satisfaction for three years. Thus adaptation wipes out higher satisfaction within the first three years being self-employed. According to our results previous studies at least overestimated possible positive effects of self-employment on job satisfaction.
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- Nattavudh Powdthavee, 2011.
"Anticipation, Free-Rider Problems, and Adaptation to Trade Unions: Re-examining the Curious Case of Dissatisfied Union Members,"
Industrial and Labor Relations Review,
ILR Review, Cornell University, ILR School, vol. 64(5), pages 1000-1019, October.
- Nattavudh Powdthavee, 2011. "Anticipation, Free-Rider Problems, and Adaptation to Trade Unions: Re-Examining the Curious Case of Dissatisfied Union Members," ILR Review, Cornell University, ILR School, vol. 64(5), pages 1000-1019, October.
- Nattavudh Powdthavee, 2009. "Anticipation, Free Rider Problem, and Adaptation to Trade Union: Re-examining the Curious Case of Dissatisfied Union Members," Discussion Papers 09/04, Department of Economics, University of York.
- Powdthavee, Nattavudh, 2010. "Anticipation, Free-Rider Problem, and Adaptation to Trade Union: Re-examining the Curious Case of Dissatisfied Union Members," IZA Discussion Papers 4806, Institute for the Study of Labor (IZA).
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