Financial Constraints and Self-Employment in France, 1945-2014

A. Bauer, Bertrand Garbinti and Simon Georges-Kot
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A. Bauer: Insee, Crest

Documents de Travail de l'Insee - INSEE Working Papers from Institut National de la Statistique et des Etudes Economiques

Abstract: This paper studies the evolution over time of the effects on entry and survival into self-employment of inheritance receipt and real estate price variations. We focus on France over the period 1945-2014, and we estimate these effects by comparing (i) current inheritors with future inheritors and (ii) homeowners without a mortgage outstanding to renters or to those with a mortgage outstanding, for whom home equity extraction is not possible in France. Our main finding is that the effect of both wealth shocks on men’s entry into self-employment has decreased over time; we find no significant effect of either wealth shock since the mid-2000s. We discuss potential causes for this trend, including changes in the financial regulation and in the sectoral composition of the economy. We also find no evidence of an effect of wealth shocks on women’s entry into self-employment, at any point in time.

Keywords: self-employment; credit constraints; inheritance; collateral channel (search for similar items in EconPapers)
JEL-codes: D31 G21 L26 N24 (search for similar items in EconPapers)
Date: 2018
New Economics Papers: this item is included in nep-his
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Citations: View citations in EconPapers (15)

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Persistent link: https://EconPapers.repec.org/RePEc:nse:doctra:g2018-08

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