IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper

How do local labor market conditions and individual characteristics affect quitting selfemployment?

  • Oberschachtsiek, Dirk
Registered author(s):

    This paper investigates the joint effect of local labor market conditions and individual differences on the duration of self-employment periods. Using register based, data the study focuses on previously unemployed business founders who have received public support to realize their entrepreneurial activities. Local labor market conditions account for a high level of complexity while personal characteristics are related to the founder's employment background. Using accelerated failure time models, controlling for unobserved heterogeneity and allowing for competing exit risk we find that higher and increasing local labor market pressure decreases the duration in self-employment whereas higher perceived (re-unemployment) risk and lower economic prosperity for incumbent firms reduce exit risks. The results reveal that the effect of external conditions is multidimensional and non-linear. On the individual level, we find strong support for the hot-house hypothesis for gaining comparative advantages.

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL: https://econstor.eu/bitstream/10419/57657/1/700585370.pdf
    Download Restriction: no

    Paper provided by Social Science Research Center Berlin (WZB) in its series Discussion Papers, Presidential Department with number P 2010-001.

    as
    in new window

    Length:
    Date of creation: 2010
    Date of revision:
    Handle: RePEc:zbw:wzbpre:p2010001
    Contact details of provider: Postal:
    Reichpietschufer 50, 10785 Berlin, Germany

    Phone: ++49 - 30 - 25491 - 0
    Fax: ++49 - 30 - 25491 - 684
    Web page: http://www.wzb.eu/
    Email:


    More information through EDIRC

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

    as in new window
    1. Hyytinen, Ari & Rouvinen, Petri, 2008. "The Labour Market Consequences of Self-employment Spells: European Evidence," Discussion Papers 1129, The Research Institute of the Finnish Economy.
    2. Williams, Donald R., 2000. "Consequences of self-employment for women and men in the United States," Labour Economics, Elsevier, vol. 7(5), pages 665-687, September.
    3. Wagner, Joachim, 2004. "Are Young and Small Firms Hothouses for Nascent Entrepreneurs? Evidence from German Micro Data," IZA Discussion Papers 989, Institute for the Study of Labor (IZA).
    4. Parker, Simon C. & van Praag, C. Mirjam, 2006. "Schooling, Capital Constraints, and Entrepreneurial Performance: The Endogenous Triangle," Journal of Business & Economic Statistics, American Statistical Association, vol. 24, pages 416-431, October.
    5. Taylor, Mark P, 1999. "Survival of the Fittest? An Analysis of Self-Employment Duration in Britain," Economic Journal, Royal Economic Society, vol. 109(454), pages C140-55, March.
    6. 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.
    7. Arntz, Melanie & Wilke, Ralf A., 2006. "Unemployment duration in Germany: individual and regional determinants of local job finding, migration and subsidized employment," ZEW Discussion Papers 06-92, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    8. Dale T. Mortensen & Christopher A. Pissarides, 1993. "Job Creation and Job Destruction in the Theory of Unemployment," CEP Discussion Papers dp0110, Centre for Economic Performance, LSE.
    9. Pernilla Andersson & Eskil Wadensjö, 2007. "Do the unemployed become successful entrepreneurs?," International Journal of Manpower, Emerald Group Publishing, vol. 28(7), pages 604-626, November.
    10. Fritsch, Michael & Brixy, Udo & Falck, Oliver, 2004. "The effect of industry, region and time on new business survival: A multi-dimensional analysis," Passauer Diskussionspapiere, Volkswirtschaftliche Reihe V-26-04, University of Passau, Faculty of Business and Economics.
    11. Blanchard, O.J. & Diamond, P., 1990. "Ranking, Unemployment Duration, And Wages," Working papers 546, Massachusetts Institute of Technology (MIT), Department of Economics.
    12. Silva, Olmo, 2007. "The Jack-of-All-Trades entrepreneur: Innate talent or acquired skill?," Economics Letters, Elsevier, vol. 97(2), pages 118-123, November.
    13. Böheim, René & Taylor, Mark P., 2000. "The search for success: do the unemployed find stable employment?," ISER Working Paper Series 2000-05, Institute for Social and Economic Research.
    14. Roberto G. Gutierrez, 2002. "Parametric frailty and shared frailty survival models," Stata Journal, StataCorp LP, vol. 2(1), pages 22-44, February.
    15. Mika Haapanen & Hannu Tervo, 2009. "Self-employment duration in urban and rural locations," Applied Economics, Taylor & Francis Journals, vol. 41(19), pages 2449-2461.
    16. Marco Caliendo & Alexander S. Kritikos, 2009. "Die reformierte Gründungsförderung für Arbeitslose: Chancen und Risiken," Discussion Papers of DIW Berlin 856, DIW Berlin, German Institute for Economic Research.
    17. Blanchflower, David G., 2000. "Self-employment in OECD countries," Labour Economics, Elsevier, vol. 7(5), pages 471-505, September.
    18. Heiko Bergmann & Rolf Sternberg, 2007. "The Changing Face of Entrepreneurship in Germany," Small Business Economics, Springer, vol. 28(2), pages 205-221, March.
    19. Blau, David M & Robins, Philip K, 1990. "Job Search Outcomes for the Employed and Unemployed," Journal of Political Economy, University of Chicago Press, vol. 98(3), pages 637-55, June.
    20. Ari Hyytinen & Pekka Ilmakunnas, 2007. "Entrepreneurial Aspirations: Another Form of Job Search?," Small Business Economics, Springer, vol. 29(1), pages 63-80, June.
    21. Yannis Georgellis & Howard Wall, 2005. "Gender differences in self-employment," International Review of Applied Economics, Taylor & Francis Journals, vol. 19(3), pages 321-342.
    22. Joachim Wagner & Rolf Sternberg, 2004. "Start-up activities, individual characteristics, and the regional milieu: Lessons for entrepreneurship support policies from German micro data," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 38(2), pages 219-240, 06.
    23. Pfeiffer, Friedhelm & Reize, Frank, 1998. "Business Start-ups by the Unemployed - an Econometric Analysis Based on Firm Data," ZEW Discussion Papers 98-38, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    24. Carrasco, R., 1997. "Transitions to and from Self-Employment in Spain: An Empirical Analysis," Papers 9710, Centro de Estudios Monetarios Y Financieros-.
    25. Chandler, Gaylen N. & Hanks, Steven H., 1998. "An examination of the substitutability of founders human and financial capital in emerging business ventures," Journal of Business Venturing, Elsevier, vol. 13(5), pages 353-369, September.
    26. Bruce, Donald & Schuetze, Herbert J., 2004. "The labor market consequences of experience in self-employment," Labour Economics, Elsevier, vol. 11(5), pages 575-598, October.
    27. Justin van der Sluis & Mirjam van Praag & Wim Vijverberg, 2005. "Entrepreneurship Selection and Performance: A Meta-Analysis of the Impact of Education in Developing Economies," World Bank Economic Review, World Bank Group, vol. 19(2), pages 225-261.
    28. Falck, Oliver, 2007. "Survival chances of new businesses: Do regional conditions matter?," Munich Reprints in Economics 20493, University of Munich, Department of Economics.
    29. Acs, Zoltan J. & Armington, Catherine, 2004. "The impact of geographic differences in human capital on service firm formation rates," Journal of Urban Economics, Elsevier, vol. 56(2), pages 244-278, September.
    30. Robinson, Peter B. & Sexton, Edwin A., 1994. "The effect of education and experience on self-employment success," Journal of Business Venturing, Elsevier, vol. 9(2), pages 141-156, March.
    31. Begona Cueto & Javier Mato, 2006. "An analysis of self-employment subsidies with duration models," Applied Economics, Taylor & Francis Journals, vol. 38(1), pages 23-32.
    32. Blien, Uwe & Hirschenauer, Franziska, 2005. "Vergleichstypen 2005: Neufassung der Regionaltypisierung für Vergleiche zwischen Agenturbezirken," IAB-Forschungsbericht 200524, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    33. Cressy, Robert, 1996. "Are Business Startups Debt-Rationed?," Economic Journal, Royal Economic Society, vol. 106(438), pages 1253-70, September.
    34. Evans, David S & Leighton, Linda S, 1989. "Some Empirical Aspects of Entrepreneurship," American Economic Review, American Economic Association, vol. 79(3), pages 519-35, June.
    35. repec:ebl:ecbull:v:10:y:2007:i:10:p:1-9 is not listed on IDEAS
    36. Santarelli, Enrico & Vivarelli, Marco, 2006. "Entrepreneurship and the Process of Firms’ Entry, Survival and Growth," IZA Discussion Papers 2475, Institute for the Study of Labor (IZA).
    37. C. Mirjam van Praag, 2003. "Business Survival and Success of Young Small Business Owners," Tinbergen Institute Discussion Papers 03-050/3, Tinbergen Institute.
    38. Mario Cleves & William W. Gould & Roberto G. Gutierrez & Yulia Marchenko, 2010. "An Introduction to Survival Analysis Using Stata," Stata Press books, StataCorp LP, edition 3, number saus3, September.
    39. David M. Blau, 1992. "An Empirical Analysis of Employed and Unemployed Job Search Behavior," ILR Review, Cornell University, ILR School, vol. 45(4), pages 738-752, July.
    40. Bates, Timothy, 1990. "Entrepreneur Human Capital Inputs and Small Business Longevity," The Review of Economics and Statistics, MIT Press, vol. 72(4), pages 551-59, November.
    41. Parker, Simon C, 2009. "Why do small firms produce the entrepreneurs?," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 38(3), pages 484-494, June.
    42. Aki Kangasharju & Sari Pekkala, 2001. "The Role of Education in Self-Employment Success," Studies in Economics 0116, School of Economics, University of Kent.
    Full references (including those not matched with items on IDEAS)

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:zbw:wzbpre:p2010001. 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: (ZBW - German National Library of Economics)

    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 references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link 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 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.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.