Self-employment Income Research Articles

Reclaiming employment: A pilot study of online entrepreneurship training for individuals with psychiatric disabilities

BACKGROUND: Many individuals with psychiatric disabilities face workplace challenges that motivate them to pursue self-employment, but accessible self-employment support is lacking. Using participatory action research, Reclaiming EmploymentTM (RE), an online interactive platform that provides self-employment education for people who experience mental health-related challenges around work, was developed to address these gaps. OBJECTIVE: An observational pilot study of RE examined usage, usability, self-efficacy, and self-employment income. METHODS: Participants (N = 97) used RE for six months; survey data was collected at three timepoints to measure entrepreneurial self-efficacy (ESE) and income generated from self-employment. Usability was assessed post-intervention using the System Usability Scale. RESULTS: More than 70% of participants used RE; there was no association between non-usage and demographic characteristics, nor prior use of other self-employment supports. RE users rated the platform at above average usability, although those who experienced long-term unemployment rated the platform significantly lower compared to wage or self-employed users. In longitudinal regression models, we found use of RE was significantly associated with increases in some ESE subscales and mean ESE. Use of RE was not associated with gains in income. CONCLUSION: This pilot study demonstrates acceptability, feasibility, and preliminary effectiveness of an online entrepreneurship training for individuals with psychiatric disabilities.

Income inequality of tribal households in Bangladesh: A decomposition analysis

This paper uses field survey data to examine farm and non-farm income to reduce income inequality among tribal households in Sylhet district, Bangladesh. It uses a decomposition method and a regression-based decomposition method to measure income and expenditure inequality by source of income as well as by household and family characteristics. For this, non-farm income was considered as an external transfer of total income to decompose the Gini index and as a potential substitute for farm income, taking into account household preferences. The results indicate that income differences exist between farm and non-farm income, thereby increasing income inequality. The endowment effect on household characteristics was positive and significant, directly supporting the increase in non-farm income per capita daily household expenditure. On the other hand, in terms of its components, non-farm self-employment income reduces income inequality, while non-farm wage income increases income inequality. At the 50th quantile results, an additional year of age of the household head increases the per capita expenditure of farm and non-farm households by BDT 300 to BDT 400, respectively. Moreover, the education of household heads also positively and significantly affects the per capita expenditure of non-farm households. As estimated by the 50th quantile, farm and non-farm households with graduation had higher per capita daily expenditure than household heads with primary education. Raising household education level and total farm household income to a better level, adopting farm-income enhancement programs, and enacting policies to increase alternative income opportunities that will shift income from non-agricultural to agricultural tribal households, reduce income inequality, and bring about the well-being of tribal society.

COVID-19 Policy Actions, Trust in Government and Tax Compliance Intentions: A Study of the British Self-Employment Income Support Scheme

COVID-19 Policy Actions, Trust in Government and Tax Compliance Intentions: A Study of the British Self-Employment Income Support Scheme

Grow the pie, or have it? Using machine learning to impact heterogeneity in the Ultra-poor graduation model

ABSTRACT The ‘Ultra-poor Graduation’ model, though highly effective in poverty alleviation, costs substantially more than alternative poverty alleviation approaches. One possible way of improving the cost-effectiveness of the model is to analyse the treatment effect heterogeneity and identify the participants who do not gain much from the programme and better customise the interventions to their needs. Applying recently developed machine learning methods on a large-scale RCT dataset from Bangladesh, we identify and characterise the program participants who benefit and who do not. We find significant variation in impact on assets where the top quintile gainers experience asset growth of 337% while asset growth is only 189% for the bottom quintile. Heterogeneity in impact on household expenditures is found to be present but of lower magnitude than that of assets. Importantly, the machine learning techniques we apply reveal contrasts in characteristics of beneficiaries who made the most in assets vs. consumption. The most benefitted households in per-capita wealth outcome were relatively older, were more dependent on wage income, had less involvement in self-employment activities, and had lower participation in household decision-making at baseline. In contrast, the top quintile gainers of household expenditure are younger, earn less from wages, depend more on self-employment income, and have higher participation in household decision-making. The results identify beneficiary characteristics that can be used in targeting households either to maximise impact on the desired dimension and/or to customise interventions for balancing the asset and consumption trade-off.

How does second-child behavior affect self-employment?

This paper focuses on the relationship between fertility and population employment, and studies the influence of second-child birth behavior on residents' self-employment. Through linear model regression, it is found that the second-child fertility rate has a significant positive impact on the self- employment rate, and the results of PSM-DID regression show that residents' second-child birth behavior has a significant positive impact on residents' self-employment income, that is, from both the macro social perspective and the individual perspective of residents, second-child birth behavior will promote residents' self-employment.

INNOVATION IN BATIK CIPRAT KARANGPATIHAN AS A CREATIVE ECONOMY DEVELOPMENT TO INCREASE SUSTAINABLE COMPETITIVE ADVANTAGE

Batik Ciprat Karangpatihan is one of the forms of cultural diversity based on batik products in the Karangpatihan village. In order to empowering disabled people, The Government of Karangpatihan Village collaborate with the Rumah Harapan Mulya personally trained them to make batik, which aims to provide jobs and self-employed income sources for craftsmen with disabilities in Karangpatihan Village. The aim of this study is to explore local economic development, inclusive economy and sustainable economy with a case study of the product Batik Ciprat Karangpatihan. This research uses a qualitative approach using primary data and secondary data. The result of the research, among other things, is the innovation of the media Batik Ciprat Karangpatihan which is a fan, cup and used T-shirt as a development of the usual fabric media. It can be concluded that the new innovation potential of Batik Ciprat Karangpatihan from the development of the local economy is by exploiting the potential of the corn grove region to filter Batik waste, the inclusive economy is empowering the disabled community and the local poor population, and the sustainable economy with the presence of development on the batik media and environmentally friendly that can then increase the income of the public by making the creation of batik with new fashion media, T-shirts, cups, and fans.

Economic Barriers to Success of Income Generating Activities of People with Disability: Evidence from Iringa Municipal Council, Tanzania

Experience in developing countries suggests that People with Disabilities (PWDs) are earning significantly less from self-employment and the share of self-employment income in the total income of their household is lower than for the people without disabilities. This study investigates the economic barriers to the success of Income Generating Activities (IGAs) of PWDs in Iringa Municipal Council, Tanzania. The study adopted a mixed method approach targeting PWDs undertaking IGAs in the study area. A sample size of 60 key respondents and 10 key informants were drawn using purposive sampling technique. Questionnaire, interview and focus group discussion methods were used to collect primary data, while documentary review was used to collect secondary data. The study found that limited access to credits due to existence of unfriendly conditions and procedure; being not trusted by financial providers; lack of entrepreneurship education due to difficulty to reach training location and lack of information; and lack of reliable market for their IGAs commodities were the economic barriers to the success of IGAs undertaken by PWDs in the study area. The study recommends some ways to improve IGAs undertaken by PWDs that include stakeholders’ innovation to allow flexibility in addressing PWDs barriers to credit accessibility, entrepreneurship education, and markets of their business commodities.

Are informal self-employment and informal employment as employee behaviorally distinct labor force states?

The paper performs both a parametric and non-parametric analysis to address a fundamental question in the growing literature using search models to study labor market informality: Should informal self-employment and informal employment as an employee be considered two different labor market states? Both analyses strongly reject equality between the two states, cautioning against aggregating them in a common “informality state”. The parametric model identifies that the variation in informal self-employment income and the short duration of informal employee jobs are the primary factors that contribute to the observed differences between these labor market states.

Tax on Self-Employed Income in the Republic of Belarus

The paper discusses tax on self-employed income in the Republic of Belarus. This state, together with the Russian Federation, forms a single Union State and is part of the most important supranational formation in the post-Soviet space: the Eurasian Economic Union. In this regard, the experience of legal regulation of self-employed taxation in the Republic of Belarus is important for the Russian theory of tax law, since it allows us to determine the vectors for further harmonization of the tax legislation of the EAEU member states, without which full-fledged economic integration is impossible. The conducted analysis of the current system of taxation of income received by self-employed in the Republic of Belarus allows us to state that it is more variable than the similar system in Russia. Moreover, in Belarus, both civil and tax legislation more clearly defines the status of self-employed citizens, and the state seeks to stimulate this type of activity. At the same time, the introduction from January 1, 2023 of a tax identical to the Russian tax on professional income allows us to conclude that Russia has chosen the right way to tax self-employed citizens through introduction of advanced digital technologies into this mechanism that provide information exchange with the tax authorities.

Incomplete Catching Up: Income among Yi, Manchu and Han People in Rural China, 2002–2018

AbstractThis paper explores household income per capita for the rural Yi and Manchu ethnic minority groups and the Han majority using data from the China Household Income Project 2002, 2013 and 2018. The disparity between total per capita income for the Yi and Han populations narrowed, while the average per capita income for the Manchu population remained relatively similar to that of the Han population. Decomposing total income to its sources shows that the rapid increase in agricultural income among the Yi was a main reason why the disparity in income, compared to the two other ethnic groups, narrowed. Nevertheless, reliance on agricultural income among the Yi was reduced as wage employment and migration increased. The Manchu group and the Han group also experienced rapid increases in wages and self-employment income. The aggregated value of transfers from the public sector was similar for all three ethnic groups.

Independent Contracting, Self-Employment, and Gig Work: Evidence from California Tax Data

The authors use de-identified data from California personal income tax returns to measure the frequency and nature of independent contracting and self-employment in California. They identify this work by the presence of a Schedule C on the tax return and/or the receipt of a Form 1099 information return. The authors estimate that 14.4% of California workers aged 18 to 64 in tax year 2016 had some independent contracting or self-employment income and approximately half of this subgroup also had earnings from traditional W-2 jobs during the year. Only a small share (1.4%) of workers had earnings from online labor platforms (often called gig work). Workers with low earnings were significantly more likely to earn independent contracting or self-employment income and to rely primarily or exclusively on that income. The article explores the characteristics of workers engaging in independent contracting and self-employment and their distribution across family type, geography, and industry.

The direct and indirect effects of messages on tax compliance: Experimental evidence from Peru

We carry out a randomized controlled trial to evaluate the effect of three types of messages sent to taxpayers on their compliance with the rental income tax (direct effect) and the spillovers produced on the capital gains and the self-employment income taxes (indirect effects). One message highlights detection, other appeals to social norms, and the third appeals to altruism. We also perform a 15-month follow-up to determine if the treatment increases tax revenues in a sustained manner. We find that the message addressing detection produces a positive and sustained direct effect and a negative spillover on the other two taxes. The “social norms” message has no direct effect but produces a sustained negative spillover on the capital gains tax. The message appealing to altruism produces a transitory negative effect and no statistically significant spillovers. We show there is substantial risk of overestimating the tax revenues produced by the messages if one relies only on their direct effects.

Self-employment, educational attainment, and hypertension among Black women and men.

Self-employment is generally associated with better health outcomes and educational attainment can shape self-employment. Yet, Black Americans are less likely to be self-employed and analyses of self-employment and health among Black Americans are few. The aim of this study was to determine how educational attainment moderates the associations between self-employment and hypertension among Black adults. Using data from the 2007-2018 National Health and Nutrition Examination Survey, participants who self-identified as non-Hispanic Black (n = 2,855) were categorized as (1) employees with no self-employment income, (2) employees with self-employment income, or (3) having full-time self-employment. Modified Poisson regressions and multiplicative interaction terms were used to determine whether educational attainment moderated the associations between self-employment and measured hypertension (i.e., 140/90 mm Hg or anti-hypertensive medication). Most participants were employees with no self-employment income (81.9%), but 11.8% were employees reporting some self-employment income and 6.3% were self-employed full-time. About two in five (40.9%) had hypertension. Having full-time self-employment was associated with lower risk of hypertension compared to those who were employees (risk ratio = 0.82, 95% confidence interval = 0.67-0.98), and educational attainment moderated the associations among Black men such that part-time self-employment was associated with high rates of hypertension among Black men who had not completed high school. These results suggest that full-time self-employment is associated with lower risk of hypertension among Black adults, but that being an employee with some self-employment income may elevate rates of hypertension among Black men depending on educational attainment. Future studies should assess pathways between self-employment and hypertension by educational attainment among Black women and men.

Self-Employment, Working Hours, and Hypertension by Race/Ethnicity in the USA.

There is a large literature on work-related characteristics and hypertension, but studies on self-employment, longer working hours, and hypertension are mixed. Assessments of self-employment should be extended to account for people with part-time self-employment (i.e., employees also earning income from self-employment). The aim of this study was to determine the association of different types of self-employment with hypertension among adults by race/ethnicity and to assess whether longer working hours moderated these associations. Using data from the 2007-2018 National Health and Nutrition Examination Survey, measured hypertension (blood pressure ≥ 140/90mm Hg) was assessed and employment categories included employees, part-time self-employment (i.e., employee with self-employment income), or full-time self-employment. Modified Poisson regressions and multiplicative interaction terms were used. Having full-time self-employment was associated with lower relative risk (RR) of hypertension compared to employees among Black (RR = 0.77, 95% confidence interval (CI) = 0.61-0.96) and White men (RR = 0.77, 0.65-0.93) compared to employees. Full-time self-employment was associated with higher risk of hypertension (RR = 1.36, 95% CI = 1.01-1.82) compared to employees among Hispanic women, while part-time self-employment was associated with lower risk (RR = 0.69, 95% CI = 0.48-0.98). Among White women, part-time self-employment was associated with higher relative risk of hypertension (RR = 1.27, 95% CI = 1.05-1.53) compared to employees. There were significant interactions between employment categories and longer working hours among Hispanic women as well as Black women and men. The results suggest that self-employment categories and longer working hours impact hypertension by race/ethnicity and sex. Because the number of full-time and part-time self-employed adults has increased, the health of this particular subgroup of workers should be further addressed.

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

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.

“Work on the Move”: Rethinking Taxation of Labour Income under Tax Treaties

Labour, in all its dimensions, has been “on the move” in the last few years. Before the pandemic, labour mobility has mostly interested only a fraction of the working population, such as highly skilled and high-net-worth individuals. COVID-19 has, however, expanded the extent of labour mobility and the categories of workers involved. This contribution discusses four major changes in labour patterns: (i) home office work; (ii) non-standard forms of employment; (iii) digital nomadism; and (iv) the decentralization of jobs. In particular, the article illustrates how a “work-from-anywhere” scenario may impact the taxation of labour income under tax treaties. Using mainly the OECD Model as a reference, the article discusses difficulties related to the application of physical presence as a sourcing rule for employment income, the distinction between dependent and self-employment income, and the concepts of home office and fixed base. Based on the analysis provided, the author formulates tentative proposals for reforming the current tax treaty treatment of labour income. Specific recommendations include the introduction of a new article jointly dealing with the taxation of labour income, a reviewed scope of application of the physical presence criterion and tax treaty definitions of home office and fixed base.

Drawing a Line: Comparing the Estimation of Top Incomes between Tax Data and Household Survey Data

The paper uses the flexibility of household survey data to align their income categories and recipient units with the income categories and units found in data produced by tax authorities. Our analyses, based on a standardized definition of fiscal income, allow us to locate, for top-income groups, the sources of discrepancy. We find, using the cases of the United States, Germany, and France, that the results from survey-based and tax data correspond extremely well (in terms of total income, mean income, composition of income, and income shares) above the 90th percentile and up to the top 1% of the distribution. Information about income composition, available in the US, allows us to investigate the determinants of this gap in the US. About three-fourths of the tax/survey gap is due to differences in non-labor incomes, especially self-employment (business) income. The gap itself may be due to tax-induced re-classification of income from corporate to personal or/and to lower ability of surveys to capture top 1% incomes.

The Perception of Filipinos on the Advent of Cryptocurrency and Non-Fungible Token (NFT) Games

Purpose – This study aims to shed light on the rise of play-to-earn games in the Philippines alongside cryptocurrency. The lack of research and public understanding of its benefits and drawbacks prompted the researchers to investigate its market. As such, the study tried to look into the risks and benefits of crypto gaming if it would be regulated by the government, and how market volatility influences the churn rate of crypto games. Method – The research used a descriptive study to determine the perception of people who are engaged in playing “Axie Infinity”. The research also used non-probability sampling using the snowball method. The only tool used to collect data was Google Forms. Furthermore, the study used Statistical Package for Social Science (SPSS) to analyze the descriptive data. Result – The results showed that most players spend their time playing Axie Infinity for about 1 to 4 hours a day. Predominantly, the return of investments for playing the game will take about 1 to 3 months. It also showed that these players agreed that there is a possible financial instability in a volatile market. With this, they have a high trust issue in terms of price manipulation, privacy and security, and its design and usability. Conclusion – Understanding the cryptocurrency market requires comprehending the perspective of the people who are engaged in a play-to-earn game, and their concerns are critical for any government actions aimed at regulating self-employed income earners playing (Non-fungible Tokens) NFT games in the Philippines. Recommendations – It is suggested that further research must be conducted to understand how self-employed Filipino income earners comprehend NFT gaming and cryptocurrency, impacting their level of interest and participation. Research Implications – Taxing NFT games without sound regulatory frameworks may result in the disarray of this alternative income source. Therefore, the government must tread carefully to avoid a market collapse or other unfavorable outcomes.

Self-employed income taxation: features and trends

Self-employed income taxation: features and trends

Obamacare and a Fix for the IRS Iteration

We model the quantities appearing in Internal Revenue Service (IRS) tax guidance for calculating the health insurance premium tax credit created by the Patient Protection and Affordable Care Act, also called Obamacare. We ask the question of whether there is a procedure, computable by hand, which can calculate the appropriate premium tax credit for any household with self-employment income. We motivate current IRS tax guidance, which has had self-employed taxpayers use a fixed point iteration to calculate their premium tax credits since 2014. Then, we give an example showing that the IRS iteration can lead to a divergent sequence of iterates. As a consequence, IRS guidance does not calculate appropriate premium tax credits for tax returns in certain income intervals, adversely affecting eligible beneficiaries. A bisection procedure for calculating premium tax credits is proposed. We prove that this procedure calculates appropriate premium tax credits for a model of simple tax returns. This is generalized to the case where premium tax credits are received in advance, which is the most common one in applications. We outline the problem of calculating appropriate premium tax credits for models of general tax returns. While the bisection procedure will work with the tax code in its current configuration, it could fail, eg, in states which have not expanded Medicaid, if a new deduction with certain properties were to arise.