Separation From the Life Partner and Exit From Self-Employment.

Leanne Van Loon,Peter Van Der Zwan,Jolanda Hessels,Cornelius A Rietveld

doi:10.3389/fpsyg.2020.01118

Leanne Van Loon, Peter Van Der Zwan + Show 2 more

Open Access

https://doi.org/10.3389/fpsyg.2020.01118

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Abstract

The survival of businesses in the market often hinges on contributions of the business owner’s household members. Partners of the self-employed as well as their children may, for example, provide emotional support but also cheap and flexible labor. Although the household composition of self-employed individuals has been analyzed in many earlier studies, little is known about what happens to the self-employed individual and his or her business when one separates from a life partner. We argue that separation from a life partner has profound financial and social consequences for the business owner. Specifically, we propose that a decrease in household income and social functioning (which is the degree of interference with social activities due to mental and/or physical problems) after separation from the life partner may lead to an exit from self-employment. Our empirical analysis draws on data from the longitudinal HILDA (Household, Income and Labour Dynamics in Australia) survey, for the period 2002–2017. Based on information from 4,044 self-employed individuals aged 18–64 years (18,053 individual-year observations), we find that separating from the life partner in the past year significantly increases the probability of exit from self-employment in the next year. Furthermore, we find that the positive association between separation from the life partner and exit from self-employment can be explained for 29.7% by a reduction in social functioning and for 10.7% by a reduction in household income. We study five exit routes out of self-employment and find that separation from the life partner mainly increases the probabilities of becoming a wage worker and of re-entering self-employment after experiencing an exit. For exit to unemployment or to a position outside the labor force (voluntarily inactive/retirement or any other non-labor force position), we find insignificant relationships with separation from the life partner. Furthermore, for all exit routes except retirement, we find significant indirect effects implying that decreased household income and levels of social functioning are important mechanisms through which separation from the life partner is related to exit from self-employment.

Highlights

Individuals from all countries and cultures commonly aspire sharing a lifelong dedicated relationship with an intimate partner (Halford and Snyder, 2012)
We investigate the roles of income and social functioning as mechanisms through which separation is related to an exit from self-employment
We found that selfemployed individuals are more likely to exit their business after they separated from their life partner

Summary

INTRODUCTION

Individuals from all countries and cultures commonly aspire sharing a lifelong dedicated relationship with an intimate partner (Halford and Snyder, 2012). Reduced social functioning as a consequence of separation from a life partner might be detrimental for the self-employed and eventually lead to an exit from self-employment. The results of our analysis are presented, and they indicate that a separation from a life partner increases the probability of an exit from self-employment in the year This relationship can, for a substantive and significant part, be explained by a reduction in social functioning and, to a smaller extent, by a reduced household income. These findings suggest that family and personal problems, which might include a separation or a divorce from a life partner, constitute an important reason for an exit from self-employment.

Methods

RESULTS

DISCUSSION AND CONCLUSION

ETHICS STATEMENT