What is the effect of university education on chances to be self-employed in transitional countries?: Instrumental variable analysis of cross-sectional sample of 29 nations

Nazim Habibov (), Elvin Afandi () and Alex Cheung ()
Additional contact information
Nazim Habibov: University of Windsor
Alex Cheung: University of Windsor

International Entrepreneurship and Management Journal, 2017, vol. 13, issue 2, No 7, 487-500

Abstract: Abstract We used a high-quality cross-sectional data set that covers a diverse set of 29 transitional countries, to find the effect of education of probability of people being self-employed using standard probit models and instrumental variable biprobit that address endogeneity. Our findings suggest a negative effect of university education on the propensity of being self-employed. This finding remains the same for the single-stage model (i.e. standard probit) and the instrumental variable model (i.e. biprobit). We found strong endogeneity in the estimation of education effect on the propensity of being self-employed, ignoring which renders estimations biased. Regression models, which do not address endogeneity tend to underestimate the negative effect of the education on the probability of being self-employed in the countries of transition. Researchers should use alternative approaches to reduce endogeneity, such as instrumental variables and longitudinal analysis.

Keywords: Education; Endogeneity; Instrumental variables; Self-employment; Transitional countries (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
http://link.springer.com/10.1007/s11365-016-0409-4 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
Journal Article: What is the effect of university education on chances to be self-employed in transitional countries?: Instrumental variable analysis of cross-sectional sample of 29 nations
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:spr:intemj:v:13:y:2017:i:2:d:10.1007_s11365-016-0409-4

Ordering information: This journal article can be ordered from
http://www.springer. ... urship/journal/11365

DOI: 10.1007/s11365-016-0409-4

Access Statistics for this article

International Entrepreneurship and Management Journal is currently edited by Salvador Roig

More articles in International Entrepreneurship and Management Journal from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().