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The determinants of occupational choice in Colombia : an empirical analysis

Author

Listed:
  • Guillaume Destré

    (TEAM)

  • Valentine Henrard

    () (TEAM)

Abstract

This economic study focuses on the determinants of self-employment / wage-work choice using a large sample of Colombian men. The econometric model is based on simultaneous determination of the choice of employment status and potential earnings, it accounts for self-selectivity. Our major findings are : (1) relative potential earnings are the main determinant of occupational choice. (2) Unlike previous studies of self-employment choice, we find a negative selection bias into self-employment. It suggests that in Colombia the decision of becoming independent might be constrained. (3) The differences in potential earnings between the two sectors are mostly due to unobserved factors.

Suggested Citation

  • Guillaume Destré & Valentine Henrard, 2004. "The determinants of occupational choice in Colombia : an empirical analysis," Cahiers de la Maison des Sciences Economiques bla04065a, Université Panthéon-Sorbonne (Paris 1).
  • Handle: RePEc:mse:wpsorb:bla04065a
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    File URL: ftp://mse.univ-paris1.fr/pub/mse/cahiers2004/Bla04065.pdf
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    References listed on IDEAS

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    3. Douglas Holtz-Eakin & David Joulfaian & Harvey S. Rosen, 1994. "Entrepreneurial Decisions and Liquidity Constraints," RAND Journal of Economics, The RAND Corporation, vol. 25(2), pages 334-347, Summer.
    4. Evans, David S & Leighton, Linda S, 1989. "Some Empirical Aspects of Entrepreneurship," American Economic Review, American Economic Association, vol. 79(3), pages 519-535, June.
    5. Dolton, Peter J & Makepeace, G H, 1990. "The Earnings of Economics Graduates," Economic Journal, Royal Economic Society, vol. 100(399), pages 237-250, March.
    6. Victor R. Fuchs, 1982. "Self-Employment and Labor Force Participation of Older Males," Journal of Human Resources, University of Wisconsin Press, vol. 17(3), pages 339-357.
    7. Evans, David S & Jovanovic, Boyan, 1989. "An Estimated Model of Entrepreneurial Choice under Liquidity Constraints," Journal of Political Economy, University of Chicago Press, vol. 97(4), pages 808-827, August.
    8. Pierre Huyette, 1997. "Mobilité et informalité : des nouvelles formes aux régulations modernes de l'emploi en Colombie," Revue Tiers Monde, Programme National Persée, vol. 38(152), pages 753-776.
    9. Blanchflower, David G & Oswald, Andrew J, 1998. "What Makes an Entrepreneur?," Journal of Labor Economics, University of Chicago Press, vol. 16(1), pages 26-60, January.
    10. Maloney, William F., 1999. "Self-employment and labor turnover - cross-country evidence," Policy Research Working Paper Series 2102, The World Bank.
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    12. Heckman, James, 2013. "Sample selection bias as a specification error," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 31(3), pages 129-137.
    13. Kidd, Michael P, 1993. "Immigrant Wage Differentials and the Role of Self-Employment in Australia," Australian Economic Papers, Wiley Blackwell, vol. 32(60), pages 92-115, June.
    14. George J. Borjas, 1986. "The Self-Employment Experience of Immigrants," Journal of Human Resources, University of Wisconsin Press, vol. 21(4), pages 485-506.
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    18. Van Praag, C Mirjam & Van Ophem, Hans, 1995. "Determinants of Willingness and Opportunity to Start as an Entrepreneur," Kyklos, Wiley Blackwell, vol. 48(4), pages 513-540.
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    Cited by:

    1. Guataqui, Juan Carlos & García Suaza, Andrés Felipe & Rodríguez, Mauricio, 2009. "Estimaciones de los determinantes de los ingresos laborales en Colombia con consideraciones diferenciales para asalariados y cuenta propia," DOCUMENTOS DE TRABAJO 005756, UNIVERSIDAD DEL ROSARIO.

    More about this item

    Keywords

    Self-employment; occupational choice; labour markets; Colombia.;

    JEL classification:

    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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