IDEAS home Printed from https://ideas.repec.org/p/iza/izadps/dp6435.html
   My bibliography  Save this paper

What Explains the Gender Earnings Gap in Self-Employment? A Decomposition Analysis with German Data

Author

Listed:
  • Lechmann, Daniel S. J.

    () (University of Erlangen-Nuremberg)

  • Schnabel, Claus

    () (University of Erlangen-Nuremberg)

Abstract

Using a large data set for Germany, we show that both the raw and the unexplained gender earnings gap are higher in self-employment than in paid employment. Applying an Oaxaca-Blinder decomposition, more than a quarter of the difference in monthly self-employment earnings can be traced back to women working fewer hours than men. In contrast variables like family background, working time flexibility and career aspirations do not seem to contribute much to the gender earnings gap, suggesting that self-employed women do not earn less because they are seeking work-family balance rather than profits. Differences in human capital endowments account for another 13 percent of the gap but segregation does not contribute to the gender earnings gap in a robust way.

Suggested Citation

  • Lechmann, Daniel S. J. & Schnabel, Claus, 2012. "What Explains the Gender Earnings Gap in Self-Employment? A Decomposition Analysis with German Data," IZA Discussion Papers 6435, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp6435
    as

    Download full text from publisher

    File URL: http://ftp.iza.org/dp6435.pdf
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. Gema Álvarez & Carlos Gradín & M. Soledad Otero, 2009. "Self-employment in Spain: Transition and earnings differential," Working Papers 0907, Universidade de Vigo, Departamento de Economía Aplicada.
    2. Kristy Eastough & Paul W. Miller, 2004. "The Gender Wage Gap in Paid- and Self-Employment in Australia," Australian Economic Papers, Wiley Blackwell, vol. 43(3), pages 257-276, September.
    3. Parker,Simon C., 2009. "The Economics of Entrepreneurship," Cambridge Books, Cambridge University Press, number 9780521728355, March.
    4. repec:eee:joecas:v:6:y:2009:i:1:p:141-165 is not listed on IDEAS
    5. Semykina, Anastasia & Linz, Susan J., 2007. "Gender differences in personality and earnings: Evidence from Russia," Journal of Economic Psychology, Elsevier, vol. 28(3), pages 387-410, June.
    6. Williams, Donald R., 2002. "Returns to education and experience in self-employment: Evidence from Germany," IRISS Working Paper Series 2002-04, IRISS at CEPS/INSTEAD.
    7. repec:hhs:iuiwop:521 is not listed on IDEAS
    8. Sandra Gottschalk & Michaela Niefert, 2013. "Gender differences in business success of German start-up firms," International Journal of Entrepreneurship and Small Business, Inderscience Enterprises Ltd, vol. 18(1), pages 15-46.
    9. Leung, Danny, 2006. "The male/female earnings gap and female self-employment," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 35(5), pages 759-779, October.
    10. Parker,Simon C., 2009. "The Economics of Entrepreneurship," Cambridge Books, Cambridge University Press, number 9780521899604, March.
    11. Aysit Tansel, 2001. "Wage Earners, Self Employed and Gender in the Informal Sector in Turkey," Working Papers 0102, Economic Research Forum, revised 01 Nov 2001.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    self-employment; self-employed; earnings differential; entrepreneurship; gender pay gap; Germany;

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp6435. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak). General contact details of provider: http://www.iza.org .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.