Resource title

Does self-employment reduce unemployment?

Resource image

image for OpenScout resource :: Does self-employment reduce unemployment?

Resource description

This paper investigates the dynamic relationship between self-employment and unem-ployment rates. On the one hand, high unemployment rates may lead to start-up activity of self-employed individuals (the refugee effect). On the other hand, higher rates of self-employment may indicate increased entrepreneurial activity reducing unemployment in subsequent periods (the entrepreneurial effect). This paper introduces a new two-equation vector autoregression model capable of reconciling these ambiguities and es-timates it for data from 23 OECD countries between 1974 and 2002. The empirical re-sults confirm the existence of two distinct relationships between unemployment and self-employment: the refugee and entrepreneurial effects. We also find that the entrepre-neurial effects are considerably stronger than the refugee effects.

Resource author

A. Roy Thurik, Martin A. Carree, André J. van Stel, David B. Audretsch

Resource publisher

Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/25654

Resource license

Adapt according to the presented license agreement and reference the original author.