Self-employment income: estimation methods, patterns, impact on distribution

Abstract

In the last decades, the number of self-employed workers has increased in advanced economies, also due to the diffusion of new forms of working relations, with a de facto subordinate relation. In the “gig economy” these new working relations became the new standard way of entering the labour market for the first time. Nevertheless, the estimates of self-employed income are often unsatisfactory. Most scholars and international organizations attribute to self-employed workers the same average unit compensation of employees. In this paper, we apply three alternative approaches for self-employed incomes estimation, focusing on six European economies: the UK, Germany, France, the Netherlands, Spain and Italy. Our favorite method is consistent with national accounts and provides a better picture of the growth process in the last decades. It gives an overall labour share which is lower than the standard one and shows a less favorable dynamics during the 2000s in most countries.