Displacement and Self-employment Entry
2009 (English)In: Labour Economics, ISSN 0927-5371, Vol. 16, no 5, 556-565 p.Article in journal (Refereed) Published
Displacement is expected to decrease the reservation wage of self-employment by decreasing earnings in paid employment and increasing the probability of unemployment. This paper examines whether displacement increases the probability of self-employment using propensity score matching on Swedish register-based data. The data include all individuals displaced due to plant closures in 1987 and 1988, and a random sample of 200,000 employed individuals. The results suggest that displacement almost doubles the probability of entering self-employment the year after displacement. A sub-sample analysis indicates that individuals with a potentially worse position on the labor market react more strongly to displacement in terms of entering self-employment.
Place, publisher, year, edition, pages
2009. Vol. 16, no 5, 556-565 p.
IdentifiersURN: urn:nbn:se:uu:diva-96790DOI: 10.1016/j.labeco.2009.02.005OAI: oai:DiVA.org:uu-96790DiVA: diva2:171479