Does non-employment based health insurance promote entrepreneurship? Evidence from a policy experiment in China

Lulu Liu and Yuting Zhang

Journal of Comparative Economics, 2018, vol. 46, issue 1, 270-283

Abstract: Previous researchers have shown that employment-based health insurance lowers job mobility and deters entrepreneurship. The Urban Resident Basic Medical Insurance (URBMI) program, piloted in 2007 in China and fully established in 2009, offers health insurance to about 271 million urban residents without formal employment. Before the implementation of URBMI, most urban residents obtained health insurance through their employers, and therefore a large number of unemployed and self-employed individuals were uninsured. Thus, URBMI creates a new insurance option that does not depend on formal employment and may promote entrepreneurship. We take advantage of this policy change to evaluate the effect of URBMI on self-employment. Using 2000–2011 data from the China Health and Nutrition Survey and a difference-in-differences approach with propensity score weighting, we found that URBMI increased self-employment rate by at least 8.73% for the overall population. The result was mainly driven by the URBMI’s impact on unhealthy workers, individuals with 12 years of schooling or less, and workers above 30 years old.

Keywords: Health insurance; Job lock; Entrepreneurship; China; Healthcare reform (search for similar items in EconPapers)
JEL-codes: H51 I1 J6 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0147596717300318
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:jcecon:v:46:y:2018:i:1:p:270-283

DOI: 10.1016/j.jce.2017.04.003

Access Statistics for this article

Journal of Comparative Economics is currently edited by D. Berkowitz and G. Roland

More articles in Journal of Comparative Economics from Elsevier
Bibliographic data for series maintained by Catherine Liu ().