Abstract
Does entrepreneurship lower the losses associated with labor market mismatching by lowering employment turnover? This paper examines whether a transition to self-employment induces a shift into an individual’s stayer-mover tendency. Using a propensity score-matching technique, the hypothesis is tested on matched employer-employee data from the entire Danish population. The analysis reveals that self-employed stay longer in their employment status compared to individuals in paid-employment. This effect is not explained by reduced attractiveness to the wage sector (lock-in effect). We interpret this finding by crafting a theory in which entrepreneurship may resolve mismatches of individuals in the labor market and may inherently increase the value of non-monetary benefits, namely independence. This counterintuitive finding – self-employment yields greater stability, all else equal – has fundamental implications for the understanding of the returns to entrepreneurship.
Original language | English |
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Publication date | 2014 |
Publication status | Published - 2014 |
Event | The Academy of Management Annual Meeting 2014: The Power of Words - Philadelphia, United States Duration: 1 Aug 2014 → 5 Aug 2014 Conference number: 74 http://aom.org/annualmeeting/ |
Conference
Conference | The Academy of Management Annual Meeting 2014 |
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Number | 74 |
Country/Territory | United States |
City | Philadelphia |
Period | 01/08/2014 → 05/08/2014 |
Internet address |