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Who Starts a Business and Who is Self-Employed in Germany

  • Fritsch, Michael

    ()

    (University of Jena)

  • Kritikos, Alexander S.

    ()

    (University of Potsdam, DIW Berlin)

  • Rusakova, Alina

    ()

    (University of Jena)

Based on representative data, the German Micro-Census, we provide an overview of the development of self-employment and entrepreneurship in Germany between 1991 and 2010, the first two decades after reunification. We investigate the socioeconomic background of these individuals, their education, previous employment status, and their income level. We observe a unique increase in self-employment in Germany by 40 percent which can partly be attributed to the transformation process of East Germany and to the shift to the service sector. We notice a yearly start-up rate of 1 percent among the working population (almost 20 percent of them being restarters), a decision that pays for the majority of individuals in terms of income. Contrary to other countries, in Germany there is a positive relationship between educational levels and the probability of starting a business.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 6326.

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Length: 52 pages
Date of creation: Jan 2012
Date of revision:
Handle: RePEc:iza:izadps:dp6326
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  1. Michael Fritsch, 2011. "The effect of new business formation on regional development - Empirical evidence, interpretation, and avenues for further research," Jena Economic Research Papers 2011-006, Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics.
  2. Marco Caliendo & Alexander S. Kritikos, 2008. "Start-Ups by the Unemployed: Characteristics, Survival and Direct Employment Effects," Working Papers 008, Hanseatic University, Germany, Department of Economics.
  3. Geroski, P. A., 1995. "What do we know about entry?," International Journal of Industrial Organization, Elsevier, vol. 13(4), pages 421-440, December.
  4. Caliendo, Marco & Künn, Steffen, 2011. "Start-up subsidies for the unemployed: Long-term evidence and effect heterogeneity," Journal of Public Economics, Elsevier, vol. 95(3), pages 311-331.
  5. Caliendo, Marco & Fossen, Frank M. & Kritikos, Alexander S., 2006. "Risk Attitudes of Nascent Entrepreneurs: New Evidence from an Experimentally Validated Survey," Discussion Papers 252, European University Viadrina Frankfurt (Oder), Department of Business Administration and Economics.
  6. David Audretsch, 2009. "The entrepreneurial society," The Journal of Technology Transfer, Springer, vol. 34(3), pages 245-254, June.
  7. repec:cup:cbooks:9780521728355 is not listed on IDEAS
  8. Blanchflower, David G., 2000. "Self-employment in OECD countries," Labour Economics, Elsevier, vol. 7(5), pages 471-505, September.
  9. David B. Audretsch, 2007. "From small business promotion to creating an entrepreneurial society," CESifo Forum, Ifo Institute for Economic Research at the University of Munich, vol. 8(2), pages 3-6, 07.
  10. Andrew Burke & Felix FitzRoy & Michael Nolan, 2008. "What makes a die-hard entrepreneur? Beyond the ‘employee or entrepreneur’ dichotomy," Small Business Economics, Springer, vol. 31(2), pages 93-115, August.
  11. Marco Caliendo & Alexander S. Kritikos, 2009. "Die reformierte Gründungsförderung für Arbeitslose - Chancen und Risiken," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 10(2), pages 189-213, 05.
  12. Poschke, Markus, 2008. "Who Becomes an Entrepreneur? Labor Market Prospects and Occupational Choice," IZA Discussion Papers 3816, Institute for the Study of Labor (IZA).
  13. 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.
  14. May-Strobl, Eva & Pahnke, André & Schneck, Stefan & Wolter, Hans-Jürgen, 2011. "Selbstständige in der Grundsicherung," Working Papers 02/11, Institut für Mittelstandsforschung (IfM) Bonn.
  15. Simon C. Parker & Yacine Belghitar, 2006. "What Happens to Nascent Entrepreneurs? An Econometric Analysis of the PSED," Small Business Economics, Springer, vol. 27(1), pages 81-101, August.
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