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Testing the 'Residential Rootedness'-Hypothesis of Self-Employment for Germany and the UK


  • Reuschke, Darja

    () (University of St. Andrews)

  • van Ham, Maarten

    () (Delft University of Technology)


Based on the notion that entrepreneurship is a 'local event', the literature argues that self-employed workers and entrepreneurs are 'rooted' in place. This paper tests the 'residential rootedness'-hypothesis of self-employment by examining for Germany and the UK whether the self-employed are less likely to move or migrate than employees. Using longitudinal data from the German Socio-economic Panel Study (SOEP) and the British Household Panel Survey (BHPS) and accounting for transitions in employment status we found little evidence that the self-employed in Germany and the UK are more rooted in place than employees. Firstly, the self-employed are not less likely to move or migrate over the period 2001–08. Secondly, those who are currently self-employed are also not more likely to have remained in the same place over a period of three years (2008–06 and 2005–03) as compared to those who are currently employed. Thirdly, those who are continuously self-employed are not less likely to have moved or migrated over a 3-period than those in continuous paid employment. Fourthly, in contrast to the prevalent 'residential rootedness'-hypothesis in economic geography and regional studies, we found that the entry into and the exit from self-employment are associated with internal migration.

Suggested Citation

  • Reuschke, Darja & van Ham, Maarten, 2011. "Testing the 'Residential Rootedness'-Hypothesis of Self-Employment for Germany and the UK," IZA Discussion Papers 6062, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp6062

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    References listed on IDEAS

    1. Werner Bönte & Oliver Falck & Stephan Heblich, 2009. "The Impact of Regional Age Structure on Entrepreneurship," Economic Geography, Clark University, vol. 85(3), pages 269-287, July.
    2. Martin Andersson & Sierdjan Koster, 2011. "Sources of persistence in regional start-up rates--evidence from Sweden," Journal of Economic Geography, Oxford University Press, vol. 11(1), pages 179-201, January.
    3. Paul Boyle & Thomas J. Cooke & Keith Halfacree & Darren Smith, 2002. "A cross-national study of the effects of family migration on women's labour market status: some difficulties with integrating microdata from two censuses," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 165(3), pages 465-480.
    4. David B. Audretsch & Oliver Falck & Maryann P. Feldman & Stephan Heblich, 2012. "Local Entrepreneurship in Context," Regional Studies, Taylor & Francis Journals, vol. 46(3), pages 379-389, April.
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    Cited by:

    1. Wouter Steenbeek & Veronique Schutjens, 2014. "The willingness to intervene in problematic neighbourhood situations: A comparison of local entrepreneurs and (un-)employed residents," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 105(3), pages 349-357, July.

    More about this item


    Germany; UK; rootedness hypothesis; migration; residential mobility; self-employment;

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship

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