Abstract
This paper empirically investigates the extent to which institutional and individual factors predict the level of intention relating to self-employment. Arriving at a better understanding of intentions will assist to provide answers as to why ratios of self-employment are as they are and how public and economic policy may respond to an often perceived requirement to increase the level of self-employment. Using the dataset of 2017 Amway Global Entrepreneurship Research (AGER) for Austria, the United Kingdom, Italy, the United States, and Brazil this study finds that all variables predicting the intention to enter self-employment are significant at varying degree. The research explores the interplay between age, risk, gender, and education, on the one hand, and unemployment (OECD Labour Force Statistics) and political constitution as measured by the EFW index, on the other hand. Distinguishing between “no intention”, an “indifferent intention,” and a “strong intention” towards self-employment, the findings show that all variables can predict a willingness for self-employment in different, but significant, ways to comparable measures (an indifferent intention relative to no intention, and a strong intention to no intention). The paper concludes with an outlook to some more general perspectives of institutional economics and needs for further research.
Highlights
Entrepreneurship is considered to be an engine for economic growth, labour market stabilization and business competitiveness
The present study shows that a higher unemployment rate is positively associated with the intention to be self-employed
This study finds that people with higher level of education tend to have strong intention to self-employment
Summary
Entrepreneurship is considered to be an engine for economic growth, labour market stabilization and business competitiveness. Countries with higher and/or increasing entrepreneurial initiative indexes tend to have lower levels of unemployment [1]. In addition to its economic importance, self-employment is often regarded as a key to a better life and social status. The consensus is to promote entrepreneurship [3], for example by increasing people’s intention to enter self-employment. This study focuses on the issue of intentions to become self-employed. These intentions must be understood as dispositions which are measured by several factors, including motivational factors affecting the desirability of starting a business, feasibility, as in feeling prepared to start a business, and stability against social pressure, in the sense that social ties do not dissuade people from starting a business [4,5]
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