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The policy drivers of self-employment: New evidence from Europe

Balázs Égert, Annabelle Mourougane (), Mark Baker and Gábor Fülöp

No 2021-3, EconomiX Working Papers from University of Paris Nanterre, EconomiX

Abstract: Using cross-country time series panel regressions for the last two decades, this paper seeks to identify the main policy and institutional factors that explain the share of self-employment across European countries. It looks at the aggregate share of self-employed as well as its breakdown by age, skill and gender. The generosity of unemployment benefits, and to a lesser extent, spending on active labour market policies appear to be robust determinants of the long-term share of self-employed in European countries. No significant relation could be identified between the stringency of employment protection and aggregate self-employment. However, there are significant, and oppositely signed, impacts on high- and low-skilled self-employed separately. Both the tax wedge and the minimum wage appear to be related positively to the share of self-employed in the long term, but the relation holds for some categories of workers only.

Keywords: self-employment; labour market; labour market regulations; labour market institutions; Europe (search for similar items in EconPapers)
JEL-codes: J01 J21 J41 J48 (search for similar items in EconPapers)
Pages: 17 pages
Date: 2021
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Working Paper: The Policy Drivers of Self-Employment: New Evidence from Europe (2020) Downloads
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