Self-employment Rates Research Articles

Can unemployment be answered by Micro Small and Medium Enterprises? Evidences from Assam

PurposeGenerating meaningful employment has become a major concern for countries across the globe to break the vicious circle of poverty. Employment creation becomes more intricate in a developing economy like India where the population is at an incessant rise, without a simultaneous increase in the employment generation. In the event of situations of mounting unemployment, micro small and medium enterprises (MSMEs) being largely labour-intensive have been claimed as a significant contributor in an economy’s development to induce employment generation. The study at hand is an attempt to gauge the overall contributions of MSMEs in employment creation in Assam, a developing region of the Indian sub-continent. However, most importantly, the purpose of this paper is to determine if men and women are differently employed in the sample MSMEs and if the pattern of employment creation is different across male and female-owned sample MSMEs.Design/methodology/approachThe study is based on a uniquely large sample of 320 MSME entrepreneurs with an equal representation of 160 each from male and female entrepreneurs. Secondary data sources were also consulted. Study areas comprising Kamrup-Metropolitan and Kamrup-Rural, depicting both urban and rural Assam, respectively. The choice of activities undertaken by the entrepreneurs includes a wide variety of 12 activities pertaining to all the MSME entrepreneurs in general and certain gender-specific in particular. The two hypotheses (H01 and H02) formulated were tested using the Chi-square test and the Mann-Whitney U test. Furthermore, the growth rate of employment generation in Assam along with the growth rate of the number of MSMEs established and investment made by the MSMEs were computed.FindingsThe calculated growth rate of employment creation, capital investment and MSMEs established were found to be positive. Based on the results of the Chi-Square test and Cramer’s V test, this paper establishes a strong association between the MSMEs and the total employment generation by the sample entrepreneurs (H01). The primary data suggested that 320 MSMEs are Employing 2,766 people in the study area with an average of 8 people per unit. Employment in the service sector is higher than the manufacturing units with an average of 4 people per unit. Another vital finding of the study professed that the women-owned MSMEs have a relatively lesser number of people (32.2%) employed than their male counterparts (67.8%). The mean rank of male entrepreneurs is considerably higher (211.49) testifying a higher employment creation by the male-owned MSMEs than the women-owned (H02). Moreover, women (33.4%) are thinly employed than men (66.5%). Women entrepreneurs were seen to have mostly limited themselves in micro-units followed by small-units. In terms of the nature of employment, full-time employees (81.8%) supersede part-time employees (6.6%). The pattern of self-employment is equal (5.8%) across both male and women entrepreneurs. MSMEs have been well identified as an impeccable answer to mitigate the problem of mounting unemployment.Originality/valueThe novelty of the study lies in its meticulous and explicit understanding of the employment scenario in Assam by the MSMEs. Empirical works on employment creation by the MSMEs in Assam were fundamentally based on secondary data sources. The study fills in the gap by providing a holistic picture of employment creation based on both primary and secondary data, but prominently on the primary. The study accounts details about the nature of MSME employment, the gender of the MSME employees, employment creation by male and female MSME entrepreneurs, the growth rate of MSME employment and self-employment to name a few

Self-employment convergence in Europe: The role of migration.

This paper attempts to identify patterns of convergence in the rates of self-employment (SE) for both foreign-born and natives in a sample of 17 European countries during the period 1999–2018. A distinction is made between self-employed with and without workers. Our analysis is relevant for policy-making: whether or not there is evidence of convergence in SE rates can be an indication of the homogeneity of self-employed workers among the countries analysed, which in turn may reflect the success of the EU-wide policies to boost SE.

Digital adoption, automation, and labor markets in developing countries

We study how digital adoption by firms—a precursor to automation—shapes the labor market structure and worker outcomes in developing countries. Using a large sample of developing countries, we document a strong and negative link between firm digital adoption and self-employment rates. This relationship persists even after controlling for the level of development and other factors associated with the distinct employment structure of developing countries. In contrast, there is no link between digital adoption and unemployment rates. We develop a model with equilibrium unemployment, self-employment, endogenous firm entry, and information-and-communications technology (ICT) adoption, and show that positive linkages between the cost of technology adoption (and therefore technology adoption itself) and salaried-firm entry costs are crucial for rationalizing the empirical relationship between firm digital adoption and self-employment.

From hot to cold: A spatial analysis of self‐employment in the United States

AbstractSelf‐employment is a geographical phenomenon influenced by national and regional contexts. However, the study of both contexts combined is scarce in the literature on the formation of regional clusters. Using panel data from the USA for 1998‐2018, we perform different techniques to study both contexts combined, including exploratory spatial data analysis and dynamic spatial estimations. We find evidence of spatial dependence of selfemployment rates, although it has decreased over time. Results also suggest that most of the spatial dependence is explained by the clusters of regions with low entrepreneurship activity, and that clusters formed by highly entrepreneurial regions are the most sensitive to fluctuations in the national selfemployment rate.

What Brings Female Professionals to Entrepreneurship? Exploring the Antecedents of Women’s Professional Entrepreneurship

This study explores how female professionals engage in starting their own businesses, known as professional entrepreneurship. In particular, this study specifies what factors foster the likelihood of self-employment of female professionals. Drawing upon the push and pull theories of entrepreneurship, we argue that individual capabilities (as a pull factor) make the self-employment of female professionals less likely, while discrimination experiences (as a push factor) make the self-employment of female professionals more likely. Given such bifurcated effects of these factors, we examine the combinatory effects of individual capabilities and discrimination experiences (which are specified as attribute-based and family-based discrimination experiences) on the rate of self-employment of female professionals. With a sample of 1356 female lawyers in the U.S., we test our hypotheses predicting the rate of self-employment with respect to prior salary and discrimination experiences. Our results reveal that prior salary (a pull factor) motivates female lawyers to stay at the traditional law firms, whereas attribute-based discrimination experiences (a push factor) motivate them to open their own office. Furthermore, we find that such a push effect is pronounced only among the female lawyers with lower salaries. Then, the empirical findings are discussed to elaborate the process of female professionals’ entrepreneurship.

Relationship between Employment Type and Self-Rated Health among Korean Immigrants in the US: Focusing on Gender and Number of Years in the US.

Although Korean immigrants report worse self-rated health and a higher self-employment rate than other Asian immigrant groups, the relationship between their employment type and self-rated health is understudied. This study examines the relationship between employment type and self-rated health among Korean immigrants in the US. Survey data of 421 first-generation working-age (18–64 years old) Korean immigrants in the New York–New Jersey area were analyzed. The self-administrated survey questionnaire included 39 items (e.g., sociodemographic characteristics, self-rated health, and health insurance status). A logistic regression analysis was conducted to examine the relationship between the dependent variable—self-rated health (e.g., bad/not bad vs. good/very good)—and independent variable—employment type (e.g., work at non-ethnic firms, work at co-ethnic firms, self-employed, and unemployed)—by focusing on differences regarding gender and number of years living in the US. Self-employed and unemployed Korean immigrants were less likely to report good health compared to those working in non-ethnic firms. After controlling for sociodemographic characteristics (age, gender, marital status, education, health insurance status, membership in any Koran association, religion, and English proficiency), the relationship between employment type and self-rated health remained significant among female and recent Korean immigrants. More worksite interventions by occupational health nurses that target self-employed Korean immigrants, especially women and recent immigrants, are necessary.

Does Student Debt Discourage Young Workers from Becoming Self-Employed?

Rising student debt balances have captured the attention of policy makers and academics; however, the effect of student debt on individuals’ self-employment behavior is still unclear. In this paper, we estimate the association between student debt and self-employment using data from the Survey of Income and Program Participation merged with administrative data on employment histories. Our results suggest that student debt is associated with lower levels of self-employment for men, with a particularly pronounced effect on men becoming primarily self-employed. In contrast, women with substantial amounts of student debt are no more or less likely to become self-employed than are women with no student debt. These findings suggest that student debt may be part of the explanation for lower self-employment rates among younger adults, and they provide additional evidence that on average male and female self-employment behavior remain distinct.

Economic Integration, Labor Markets and Regional Social Externalities in Central America

A vast literature has analyzed the transmission of economic growth spillovers across developing countries that are members of economic integration programs, but scant attention has been directed to analyzing the repercussions of economic integration on member countries' labor markets. This is a grave shortcoming given that unemployment and underemployment constitute serious problems in developing countries; if research indicated that economic integration was a means to promote employment, the implications would be that it can be a source of meaningful benefits to the member countries, and that other developing countries should pursue their own integration programs. The objective of this study is to analyze, for one Central American country, El Salvador, the responses of its rates of wage and self-employment to economic dynamism and remittances in the other Central American countries. The methodology consists in the estimation of econometric equations that explain El Salvador' annual rates of self and wage employment in terms of their own economic growth and remittances, and those of the other Central American countries' and of the US, as in a regional Okun's law. The impacts of regional external aid received by a country on the other member countries' employment is also analyzed, as well as the existence of synchronism in member countries' rates of economic growth and its implications on the adoption of a common currency. The results show that wage employment increases and self-employment decreases in El Salvador in response to its own economic growth and remittances, and in response to economic growth and remittances in other Central American countries. Other results show the importance of adequate tax revenues in member countries so as to promote national social development and strengthen the integration program. An important result consists of the evidence that crime, homicide rates specifically, has a regional nature in Central America, resulting from the interdependence in national labor markets. The main policy implication is that in Central America, labor markets should be analyzed on a regional scope. Another implication is that it may be more effective to design social policies on a regional level, so as to obtain the benefits created by social externalities that result from the interdependence of labor markets. These results have not been analyzed in previous literature.

Declining Search Frictions and Type-of-Employment Choice

Do more people choose to become self-employed when search frictions decline? The origin story of the gig economy suggests that improvements in communication technologies increase the self-employment rate, while cross-country evidence suggests the opposite. We reconcile conventional wisdom with the data by introducing frictions in labour and goods markets in a new model of self-employment. Declining labour market frictions decrease self-employment, while declining goods market frictions increase self-employment. We study the impact of the most salient recent reduction in frictions - the roll-out of broadband Internet - in a panel of OECD countries. We find that the effect of declining goods market frictions dominates: the arrival of broadband Internet has halted three quarters of the average downward trend in self-employment rates.

Vietnamese Immigrant Entrepreneurship: A Comparison of Self-Employment in Vietnam and the United States

In this paper, we examine the case of Vietnam as an example of this phenomenon. In Vietnam, the World Bank Indicators show a self-employment rate of 60% among men in 2008, whereas the United States rate is less than 15%. This wide gap between the two countries even greater than that between Mexico and the U.S. (Fairlie and Woodruff, 2007). We use census microdata from Vietnam and the U.S. as well as an understanding of the economic systems in the two countries to understand the differences in the self-employment rate of the Vietnamese in Vietnam versus Vietnamese immigrants in the U.S. and to give some insight into the nature of self-employment in the two countries. We utilize two analysis methods on various variables to investigate the differences in the rates of self- employment. This diversified analysis enables one to understand the differences between the two economies and the differences between Vietnamese workers in Vietnam and Vietnamese immigrants in terms of self-employment. Through these analyses, we can explain some parts of the differences.

Study of the development trajectory of the status indicator in employment in the context of digital transformation

Changes in employment status and rising unemployment are global and driven by rapid technological progress. The coronavirus pandemic also played a huge role, increasing the unemployment rate by 2-4% in different economies. The most declining industries are arts, culture and recreation; spheres of education, law and social, communal and state services; trade. Today, the fragmentation of employment up to self-employment and the spread of various forms of precarious work are clearly visible, and there is an inverse relationship between the share of self-employed workers and the GDP of their countries: in 2018, Burundi had the highest level of self-employment in the world - almost 95%. Arab countries posted the lowest self-employment rates at 1.7%. The emergence of new professions and employment profiles opens up a number of opportunities for the unemployed and the self-employed.

İSLAM ÜLKELERİNDE EKONOMİK ÖZGÜRLÜĞÜN GİRİŞİMCİLİK ÜZERİNDEKİ ETKİSİ

The level of economic freedom which is expressed as institutions and policies based on market economy is one of the most significant indicators of entrepreneurial activities since the increase in economic freedom has caused a decrease in transaction costs preventing the entrepreneurial activity. The aim of this study is to analyze the effect of economic freedom on entrepreneurship in Islamic countries by using the data belonging to years between 1995 and 2019. In the study, self-employment rate has been used as entrepreneurial criterion; gross domestic product per capita, money supply, import and inflation have been used as the indicators of the entrepreneurship; economic freedom index presented by The Heritage Foundation and its 9 subcomponents out of 12 (property rights, government integrity, government spending, tax burden, business freedom, monetary freedom, trade freedom, investment freedom and financial freedom) have been used as the economic freedom criterion. According to the findings of this study, entrepreneurship has been affected positively by economic freedom and property rights, government integrity, government spending, monetary freedom, investment freedom and financial freedom and negatively by tax burden and trade freedom.

The Self-Employment Rate Index as a Measure of Economic Trends: Impact of Heterogeneity of the Self-Employed on the Quality of Indicators

Purpose: The aim of this part of the paper was to examine whether there are any observable trends between the or percentage of in the labour market and business climate indicators, and can any conclusions be drawn whether the currently existing methods of monitoring labour are sufficient. Approach/Methodology/Design: In this paper, the hypothesis was tested that the are not a cohesive group. That is why labour market monitoring structure based on indicators related to “self-employment rate” is not sufficient to observe the trends in changes occurring in the contemporary labour market. Correlations between the business climate and labour market indicators and the various subgroups tend to be not similar. The group of is diverse and includes different areas and forms of work, which demonstrate varied tendencies and should be considered separately. Moreover, it includes groups that can now be formally separated, for example individual farmers, traditional and hybrid self-employed, employers. Findings: Our analysis clearly shows that the commonly used indicator number of self-employed or “self-employment rate” is inadequate for analysing trends in the labour market as it doesn’t showcase the complexity of problems related to changes in this market. This indicator should not be the basis for assessing economic trends, including those in the labour market. It is also insufficient for concluding about the very nature of labour and for monitoring Economy 4.0. Practical Implications: It is necessary to discuss the new classification of people who are active in the labour market. New indicators should be developed, to demonstrate changes in the labour market more accurately.

Modelling the Spread of COVID-19 in New York City

This paper proposes a methodology to predict the increase in the number of confirmed COVID-19 cases in the city of New York at the zip code level. We concentrate on the initial period of the pandemic spanning from March 31 to June 16, 2020. To do this, we propose a Poisson regression model for count data that includes a large set of covariates reflecting socioeconomic conditions at neighbourhood level and spatial effects. The sensitivity of the predictions of the number of cases to the specific choice of the regressors is controlled for by also considering an emsemble prediction model given by Bayesian model averaging. Our results extend related studies by showing that variables such as population size, its share of the elderly, the self-employment rate, income per capita, and the percentage of workers in the educational and healthcare sectors not only explain the cross-sectional variability in the number of new confirmed cases but also have out-of-sample predictive ability. Our pointwise forecasts display reasonable mean square prediction errors and the associated interval forecasts accurate empirical coverage probabilities suggesting the suitability of the methodology for prediction of the number of infections.

Migrant Entrepreneurship in Spain: a Systematic Review

Introduction: Spain became an immigrant receiving country in the mid-nineties of the 20th century, when foreign workers started arriving, attracted by the booming market for unskilled labour. They traditionally entered the secondary market as employees, showing a self-employment rate lower than that of natives. However, during the economic downturn, ethnic businesses significantly increased, adopting new strategies and proving the resilience of immigrant entrepreneurs.Method: This paper aims to gather peer-reviewed literature to investigate migrant entrepreneurship in Spain, and its implications in immigrant’s performance in the labour market. Thirty-nine papers met the criteria.Results: Results show that migrant entrepreneurs: (1) respond to necessity and opportunity (2) are mainly focused on open market, rather than on ethnic business; (3) seek support in transnational practices.Discussion and/or Conclusion: Our analysis shows that Spanish migrant entrepreneurs’ behavior is not fully fitting into the classical theoretical frameworks and that in general there is a certain overlapping or a new model arising. In fact, the crisis has brought changes to ethnic minority businesses and their vulnerability with higher turnover. But it also has brought opportunities, innovation, new niches, transnational focus, and certain ease in access to property.

Persistence in Self-Employment Rates before the Great Lockdown: The Case of the UK

A growing body of empirical literature—both on the micro and macro scale—is devoted to exploring the existence of hysteresis—or at least persistence—in self-employment, i.e., whether policy, economic or external shocks have transitory or persistent effects on the probability of survival, and in turn, on the natural rate of self-employment. In aggregate time series studies, the usual method to address this issue has been to look for unit roots by using alternative tests or by using unobservable components models. In this research, we performed a battery of tests and competing approaches to check the robustness of our results with UK self-employment time series. The UK is a suitable case for study because the recent evolution of the UK self-employment rate figures shows a steady growth since the beginning of the millennium. This long-term rise in UK self-employment has attracted the attention of scholars, at least, before the Great Lockdown. We find evidence of hysteresis, while business cycle output variations significantly affect self-employment rates. The article discusses the implications of the findings.

Labour Market Changes in the Digital Era: UK Women and the Shift to Part-Time Self-Employment

Existing research often obscures women's self-employment activity by considering the self-employed as a homogenous group. This paper sheds light upon the conditions under which UK women create and do business in the contemporary digital era by investigating surprisingly dissimilar patterns of self-employment participation for women and men. In particular, it focuses upon dramatic growth in the category of home-based, flexible self-employment, in which women's participation features highly. Using Office for National Statistics Labour Force Survey data, we use probit modelling techniques to explore employment modes, self-employment types, and work arrangements amongst different groups. We find that whilst the overall rate of self-employment in the UK is growing, women as a cohort are responsible for such growth. Rates of male and White British self-employment are falling, and part-time activity, particularly amongst BME women, is driving the overall increase. We explain these shifts by considering the persistent effects of gender and race structures on economic opportunities, and explore the implications of our findings for issues of policy and sustainability. The paper thus provides a theoretical and empirical foundation from which to examine how and why women's self-employment activity in the digital era underpins an emergent structural shift in the UK labour market.

DOES ETHNIC AFFILIATION AFFECT THE CHOICE TO BE SELF-EMPLOYED? CASE STUDY ON THE LABOR MARKET IN ISRAEL

The aim of the paper is to empirically examine the variables that influence the choice of economic status, with emphasis on the differences between Arabs and Jews in Israel regarding this economic choice. Self-employed workers - business owners or entrepreneurs - are the force that contributes to the progress of individuals, companies and countries and are, therefore, an important factor for economic policy makers. The sector of self-employed workers - despite the numbers above - is a tier of significant specific attention in the workforce. However, so far, the self-employed sector has not received the proper attention in the literatur. The results indicate differences in the economies in which Jews and Arabs work as self-employed workers, and it is evident that there are areas that are more typical of self-employed Jews or self-employed. The industries in which the self-employment rate is advantageous or equitable for the self-employed are vehicles (sales and repair), electricity and water supply, banking and insurance. The first two areas do not require higher education, and can be associated with neighborhood / home services that characterize the self-employed in this level of education. In contrast, in education, public administration and construction, Jews had a considerable advantage in the employment rate as self-employed.

Managerial Delegation, Law Enforcement, and Aggregate Productivity

AbstractI propose a novel general equilibrium framework to quantify the impact of law enforcement on the internal organization of firms and thereby on aggregate outcomes. The model features an agency problem between the firm and its middle managers. Imperfect law enforcement allows middle managers to divert revenue from firms, which reduces delegation and constrains firm size. I use French matched employer–employee data for evidence of the model’s pattern of managerial wages. Relative to the French benchmark economy, reducing law enforcement to its minimum value decreases GDP (equivalently, total factor productivity; TFP) by 23% and triples the self-employment rate. Consistent with the model, I document cross-country empirical evidence of a positive correlation between law enforcement indicators and the aggregate share of managerial workers. Mapped across the world, the model explains 3–6% of the ratio in GDP per worker between the poorest and richest quintile of countries, and 6–11% of their TFP ratio.

Overdose Deaths and Entrepreneurial Activity

Drug overdose deaths, primarily due to opioid addiction, have devastated communities in almost every area of the U.S. The economic impacts of the crisis include additional healthcare resources, unemployment, lost productivity, criminal justice costs, and other indirect impacts that have not yet been researched. This study aims to estimate one potential impact of opioid dependency in communities by estimating the relationship between drug overdose deaths and entrepreneurship. In particular, the empirical models measure how entrepreneurship, as measured by the percentage of self-employed workers, changes in relation to the number of overdose deaths in all U.S. counties, controlling for a number of socioeconomic characteristics. The results suggest that overdose deaths are associated with significant declines in self-employment rates. The coefficients on overdose death rates are generally larger in magnitude for rural counties than for larger metro counties.