The Impact on Earnings When Entering Self-Employment: Evidence for Germany

Johannes Martin

No 537, SOEPpapers on Multidisciplinary Panel Data Research from DIW Berlin, The German Socio-Economic Panel (SOEP)

Abstract: Using data of the German Socio-Economic Panel (GSOEP) earnings differentials between self-employed and wage-employed workers in the German labor market are explored. Previous research based on US data reports lower incomes for entrepreneurs. In contrast to that, the findings of this contribution suggest the opposite for German entrepreneurs. They have considerably higher earnings than wage-employed workers. Furthermore, there is a significant and positive effect on earnings when entering self-employment. This holds true when it is also taken into account that workers usually report a smaller firm size and work longer after beginning an entrepreneurial occupation.

Keywords: Self-employment; Human Capital; Earnings; GSOEP; Entrepreneurship (search for similar items in EconPapers)
JEL-codes: J31 J32 L26 (search for similar items in EconPapers)
Pages: 36 p.
Date: 2013
New Economics Papers: this item is included in nep-ent, nep-eur, nep-hrm, nep-lab and nep-lma
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

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Persistent link: https://EconPapers.repec.org/RePEc:diw:diwsop:diw_sp537

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