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Start-Ups by the Unemployed: Characteristics, Survival and Direct Employment Effects

Supporting start-ups by unemployed persons with governmental programs became an important issue as benefits could include termination of unemployment and further job creation. However, it is feared that previously unemployed lack qualifications for entrepreneurship. We analyze potential effects based on a data-set containing a representative sample of 3,100 start-ups founded by unemployed in Germany. We find that these founders are motivated by push and pull factors. Using a proportional hazard duration model with unobserved heterogeneity allows us to analyze the characteristics which drive success of the businesses. While survival rates are high, the characteristics of the developed businesses are heterogeneous.

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File URL: ftp://212.204.40.50/econ/RePEc/pdf/phu_dp_008.pdf
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Paper provided by Hanseatic University, Germany, Department of Economics in its series Working Papers with number 008.

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Length: 34 pages
Date of creation: Apr 2008
Handle: RePEc:phu:wpaper:008
Contact details of provider: Web page: http://www.hanseuni.com

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