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The Role of Job Satisfaction in Transitions into Self-Employment

  • Giuliano Guerra


    (Ufficio per lo sviluppo economico, Repubblica e Cantone Ticino, Switzerland)

  • Roberto Patuelli


    (Department of Economics, University of Bologna, Italy; The Rimini Centre for Economic Analysis (RCEA), Italy)

Self-employment is often seen as an attractive alternative to wage employment, despite lower welfare protection, higher risks, and more required effort than in the latter. It is then important to investigate why individuals choose self-employment. In addition to potential earnings, other factors may be considered, including displacement, uncertainty, unemployment risk, and dissatisfaction. Building on a job quits model, we propose an empirical representation of transitions to self-employment which includes subjective evaluations of pecuniary and nonpecuniary satisfaction on the previous job. Additionally, we focus on the dynamics of job satisfaction, highlighting the role played by shocks in subjective evaluations.

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Paper provided by The Rimini Centre for Economic Analysis in its series Working Paper Series with number 63_12.

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Date of creation: Sep 2012
Date of revision: Jul 2014
Publication status: Published in Entrepreneurship Theory and Practice 40(3):543-571, 2014
Handle: RePEc:rim:rimwps:63_12
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