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The purpose of this paper is to investigate the influence of the predicted earnings differential between self‐employment and wage‐employment on self‐employment propensities in Sweden using a large data set from the year 2003.

The analysis in the paper is based on the presumption that the individual chooses to work in either the self‐employed or the wage‐employed sector. The separate earnings functions for the self‐employed and the wage‐employed are estimated in order to predict an individual's earnings in each sector. In order to overcome selectivity problems a Heckman approach is used at this stage. Finally, a structural probit model, where the difference in predicted earnings from the two sectors is included as an independent variable, is estimated.

The main result is that the predicted differential between self‐employment and wage‐employment earnings plays an important role for the self‐employment decision and that an increase in this earnings differential will lead to a higher self‐employment rate and to an increase in total employment in Sweden.

The policy relevance of this question is evident since previous research has shown that self‐employed individuals do not only create jobs for themselves but also for others. Thus, an increase in the earnings from self‐employment relative to the earnings from wage‐employment will increase the self‐employment rate as well as total employment.

Discusses the increase in self‐employment in the UK over the past decade. Presents the results of a cross‐sectional, comparative, static analysis of the determinants of self‐employment using data on the UK counties. The results suggest that greater attention should be paid to non‐economic factors for self‐employment.

The article assesses the direct and indirect impact of a major redundancy on local unemployment. The extent of these effects depends on the way in which the local labour market adjusts. Two hypotheses are considered. (1) that the redundant workers displaced other labour market participants from work; and (2) that self‐employment assisted the process of labour market adjustment and, therefore, reduced both the direct and indirect effects of the redundancy on unemployment. The data for the research are taken from a survey of workers made redundant, in May 1985, from the Michelin tyre company based in Stoke‐on‐Trent, England. The results suggest that displacement took place in the manufacturing sector of the local economy, but that self‐employment was important in easing the “dynamic” adjustment of the post‐redundancy labour market. Policy makers should recognise that a part of the adjustment process is the use of self‐employment as a temporary employment state.

This study aims to investigate the empirical linkages between self-employment, financial access and economic welfare in Africa. It particularly examines the moderating role of financial access in the self-employment-economic welfare nexus and determines relevant thresholds.

The paper samples 52 African economies from 2000 to 2018 and deploys the fixed effects and bootstrap quantile regression estimators.

The results show that self-employment has a negative and significant relationship with economic welfare, while access to finance has a positive and significant relationship with welfare. More notably, the conditional effect of self-employment and finance is significant and positive, confirming a synergetic effect. The result suggests that pushing more people into self-employment does not necessarily enhance economic welfare, other than the avoidance of unemployment, due to the large number of replicative and necessity entrepreneurs. However, granting the self-employed more access to affordable finance that boosts entrepreneurial activities enhances economic welfare.

African governments and relevant policymakers must recognize that deepening the financial sector is crucial in creating sustainable opportunity entrepreneurs and boosting general economic welfare.

The uniqueness of this paper centers on the exposé of the relevance of financial access/development in promoting the economic welfare of self-employed persons and entrepreneurs. It also determines relevant thresholds at which finance is most significant in procuring positive impacts on economic welfare. In addition, the simultaneous quantile regression is used to show snapshots of human development index at which this impact is paramount.

Purpose – The purpose of this chapter is to investigate empirically whether entrepreneurship causes growth or whether growth creates a prosper environment for entrepreneurship.

Design/methodology – We perform a co-integration analysis using an error correction model on data from 34 countries spanning 13 years to assess the causality issue between growth (proxied by GDP per capita) and entrepreneurship (proxied by self-employment). Our analysis also includes other variables deemed to influence growth.

Findings – The results from an error correction model show that self-employment Granger causes GDP per capita while the opposite direction is not statistically accepted. Moreover, these results suggest that increases in self-employment increase GDP per capita over the short-term but leads to a GDP per capita decrease at a long-term horizon.

Research limitations and implications – We use a linear model to estimate the relationship between self-employment and Growth. Consequently, a more complex model allowing for nonlinearities and additional variables might be more accurate. The empirical investigation is limited to self-employment, which is one facet of entrepreneurship, hence it will be interesting to introduce other measures of entrepreneurship. A direct implication of our study is that rather to be a sustainable economic driver, self-employment seems to resolve only a short-term problem.

Value – The chapter contributes by analyzing the relationship between self-employment and growth by using a co-integration analysis. Consequently it offers a more rigorous appreciation of the direction of causality as well as the long- vs. short-term relationships.

Insights into the origins of entrepreneurial activity are gained through a study of alternative mechanisms implicated in the tendency for children of the self-employed to be substantially more likely than other children to enter into self-employment themselves. I use unique life history data to examine the impact of parental self-employment on the transition to self-employment in Denmark and assess the different mechanisms identified in the literature. The results suggest that parental role modeling is an important source of the transmission of self-employment. However, there is little evidence to suggest that children of the self-employed enter self-employment because they have privileged access to their parent's financial or social capital, or because their parents’ self-employment allows them to develop superior entrepreneurial abilities.

This study explores the manner in which gender inequality in the transition into self-employment is associated with the institutional contexts of family and labour market structures in the East Asian countries of Japan, Korea and Taiwan. This work contributes to theoretical debates on gender inequality and entrepreneurship because prior research on female self-employment has lacked a theoretical viewpoint on the mechanisms by which conditions for female entrepreneurship depend on the macro-structural arrangements of family and labour markets. By evaluating female employment in light of the patriarchal Confucian ideology, I examine gender disparities among individuals in terms of effects of paternal self-employment, their experiences as family workers and their marital status on their transition into self-employment. The results of this study show that women in Japan and Taiwan do not benefit from the self-employed status of their fathers as much as their male counterparts. Additionally, female family workers in the three countries had considerable disadvantages in becoming self-employed, which implies that female family workers continue to be exploited by self-employed owners, namely, their husbands. In contrast, the effects of marital status, with both sexes, on their transitions into self-employment differed widely among the three countries, reflecting the various barriers to self-employment and the differing conditions for female employment in each country. Overall, this study demonstrates that gender inequality in the transition into self-employment is related to family structures unique to these East Asian countries. This study, however, did not compare the dynamics of self-employment between East Asian societies and other industrialised nations. Future studies should explore whether the findings of this study are applicable to other industrialised societies.

This research compares the effects of career credentials and family factors on self-employment careers in the United States and Western Germany. In Germany, both general education and vocational credentials structure self-employment, primarily at entry. In the United States, general education alone structures self-employment, primarily by stabilizing the self-employment careers of workers with higher credentials. Intergenerational transmission of self-employment is more prominent among men, while spousal transmission of self-employment status is more prominent among women. In the United States, but not in Germany, there is evidence of a “caretaker” pathway that brings mothers of young children into self-employment for short periods of time.

Controversy in the literature exists over whether self-employment is driven by worker’s deliberate entrepreneurial choices (pull factors) or an indeliberate subsistence employment option (push factors) in developing countries. It is therefore very important to investigate whether the self-employed are the dynamic entrepreneurial group or the subsistence-oriented group. In this chapter, the authors examine the driving forces behind the plausible growth of self-employment in urban and rural Nigeria by analyzing the self-employment choices as a function of employment’s differences in predicted earnings, human capital, demographic and family characteristics. Using the 2010/2011 and 2012/2013 waves of the General Household Survey Panel data for Nigeria, this chapter utilizes the Random Effects Regression Models (OLS and Probit Models). This chapter finds that the predicted individual earning differences between self- and paid-employment has a negative significant effect on self-employment choices – contrary to developed countries’ evidence. In other words, overwhelmingly the poor are “entrepreneurs.” This therefore means that self-employment choice is driven by the necessity of survival – the subsistence self-employed groups rather than the dynamic entrepreneurial hypothesis. The implication of these finding is unique and interesting for an African country such as Nigeria where the self-employees are vulnerable to poverty and perhaps an involuntary employment option conditioned by economic failures.

Wage employees enter self-employment either directly or in a staged manner and may subsequently undertake multiple stints at self-employment. Extant research on the relationship between entry modes and the persistence and outcomes of self-employment is inconclusive. This study investigates the relationship between wage employees’ initial mode of entry into self-employment and the duration of the subsequent first two stints of self-employment.

This study used a matched longitudinal sample of 9,550 employees who became majority owners of incorporated firms from 2005 to 2016.

The findings demonstrate that the initial mode of entry into self-employment matters for the first two stints at self-employment. Staged entry into self-employment was associated with a shorter first stint and became insignificant for the second stint. Staged entry into self-employment was positively related to the odds of becoming self-employed for the second time in the same firm.

Using a comprehensive and reliable dataset, the paper shifts focus from the aggregated onward journey of novice entrepreneurs (survival as the outcome) to the duration of their self-employment stints. By doing so, the paper offers insights into the process of becoming self-employed and the patterns associated with success/failure in entrepreneurship associated with self-employment duration.