The dynamics of solo self-employment: Persistence and transition to employership

Daniel S. J. Lechmann and Christoph Wunder

No 98, Discussion Papers from Friedrich-Alexander University Erlangen-Nuremberg, Chair of Labour and Regional Economics

Abstract: This study examines dynamics of solo self-employment. In particular, we investigate the extent of true state dependence and cross state dependence, i.e., whether experiencing solo self-employment causally affects the probability of becoming an employer in the future. We use data from the German Socio-Economic Panel to estimate dynamic multinomial logit models. Our results show that the extent of true (cross) state dependence is rather small. The observed persistence in solo self-employment as well as transitions from solo self-employment to employership can largely be explained by observed and unobserved heterogeneity.

Keywords: state dependence; dynamic multinomial logit; solo self-employment; own-account worker; stepping stone (search for similar items in EconPapers)
JEL-codes: J23 J62 (search for similar items in EconPapers)
Date: 2016
New Economics Papers: this item is included in nep-dcm
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:faulre:98

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