Female self-employment: prevalence and performance effects of having a high-income spouse

Carl Magnus Bjuggren and Magnus Henrekson ()

Small Business Economics, 2022, vol. 59, issue 1, No 9, 163-181

Abstract: Abstract Little is known about self-employment as a career choice for women who marry a high-income spouse. Using rich Swedish register data, we show that Swedish women who are married to a high-income spouse are, on average, highly educated and more likely to pursue self-employment than those married to a spouse in the middle of the income distribution. Our results indicate that the likelihood of entering self-employment increases by 128–176% for women who marry a spouse in the top of the income distribution, and the shift into self-employment is associated with a lower income. This can be interpreted as a career choice that produces a more flexible work schedule in return for lower income. In a Nordic welfare state, where work is the norm for women, self-employment offers a way to avoid the stay-at-home stigma. It allows one to stay in the workforce while enjoying approval from society and being in control of one’s work schedule and personal demands. Plain English Summary This study shows that self-employment allows women to stay in the labor force and have control over their work-life balance. By staying in the labor force, they are able to avoid the stay-at-home stigma. Despite the increase in female labor force participation during the past century, gender equality appears to have stalled in the top 1%. Highly educated women are leaving the labor market to assume responsibility for their children while the husbands are pursuing their career. In Sweden, being a stay-at-home wife is met with social disapproval. One way to avoid the stay-at-home stigma while being in control of your work-life balance is to become self-employed. We show that the likelihood of entering self-employment increases by 128–176% for women who marry a spouse in the top of the income distribution, and the shift into self-employment is associated with a lower income. That women are abandoning a potential high-income career for low-income self-employment may be harmful to both society’s efforts to create a system with equal rights and opportunities, and for the economy’s potential growth rate.

Keywords: Career choice; Entrepreneurship; Marriage; Self-employment; Women; J16; J12; J13; J22; L26 (search for similar items in EconPapers)
Date: 2022
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Working Paper: Female Self-Employment: Prevalence and Performance Effects of Having a High-Income Spouse (2020)
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DOI: 10.1007/s11187-021-00526-0

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