The labour market and tax policy drivers of self‐employment: New evidence from Europe

Balázs Égert and Annabelle Mourougane

International Labour Review, 2024, vol. 163, issue 2, 295-323

Abstract: Using cross‐country time series panel regressions for 1995‐2022, this article seeks to identify the main labour market and tax policies affecting self‐employment in European OECD countries. It uncovers heterogeneous policy impacts for different forms of self‐employment and considers how the share of self‐employment correlates with changes in policies along dimensions including sex, age and skills. Minimum wages and employment protection legislation appear to be robustly associated with changes in the long‐term share of own‐account self‐employment, whereas the share of self‐employment with employees appears to coincide with changes in the tax wedge and unemployment benefits. Deindustrialization is found to be positively correlated with self‐employment, which exhibits some cyclical properties.

Date: 2024
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