Does ‘Being Your Own Boss’ raise your chance of becoming someone else’s Boss?
DOI:
https://doi.org/10.58567/eal02040008Keywords:
Solo self-employment; Employership; Steppingstone effectsAbstract
Self-employment is often associated with entrepreneurship and regarded as a driver of innovation, job creation and economic growth. As such, many countries have policies to promote and support self-employment. One mechanism for self-employment to drive job growth is for sole traders to become an employer through hiring employees. However, there are few studies that investigate if solo self-employment helps the transitions into employership. Using the Understanding Society data, this study shows that in the UK labour market solo self-employment does not work as a ‘steppingstone’ to employership. This raises the question why self-employment should be promoted through public policy as in the UK and many other developed countries.
References
Baumol, W., (1996). Entrepreneurship: Productive, Unproductive, and Destructive. Journal of Business Venturing. 11, 3-22. https://doi.org/10.1016/0883-9026(94)00014-X
Cowling, M., Wooden, M., (2021). Does Solo Self-employment Serve as a ‘Stepping Stone’ to Employership? Labour Economics. 68. https://doi.org/10.1016/j.labeco.2020.101942.
Greene, W., (2002). Econometric analysis, 4th edition, Macmillan Publishing Company: New York.
Heckman, J., (1981). The Incidental Parameter Problem and the Problem of Initial Conditions in Estimating a Discrete Time-Discrete Data Stochastic Process, in: Manski, C. and McFadden, D. (Eds), Structural Analysis of Discrete Data. MIT Press, Cambridge.
Henley, A., (2019). Transitioning from Solo Self-employed to Microbusiness Employer: Local Economic Environment or Owner Characteristics? IZA Discussion Paper No. 12189. https://ssrn.com/abstract=3390176
Knies, G., (2018). Understanding Society Waves 1-8 User Guide. Institute for Social and Economic Research, University of Essex.
Lechmann, D., Wunder, C., (2017). The Dynamics of Solo Self-employment: Persistence and Transition to Employership. Labour Economics. 49, 95-105. https://doi.org/10.1016/j.labeco.2017.09.002
Millan, A., Millan, J., Congregado, E., Roman, C., (2014). Persistence in Entrepreneurship and Its Implications for the European Entrepreneurial Promotion Policy. Journal of Policy Modeling. 36, 83-106. https://doi.org/10.1016/j.jpolmod.2013.10.001
Mundlak, Y., (1978). On the Pooling of Time Series and Cross Section Data. Econometrica. 46, 69-85. https://doi.org/10.2307/1913646
OECD, (2000). OECD Employment Outlook 2000. OECD Publishing, Paris.
OECD/European Union, (2014). The Missing Entrepreneurs 2014: Policies for Inclusive Entrepreneurship in Europe. OECD Publishing, Paris. https://doi.org/10.1787/9789264213593-en
Wooldridge, J., (2005). Simple Solutions to the Initial Conditions Problem in Dynamic, Nonlinear Panel Data Models with Unobserved Heterogeneity. Journal of Applied Econometrics. 20, 39–54. https://doi.org/10.1002/jae.770
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2023 Lixin Cai
This work is licensed under a Creative Commons Attribution 4.0 International License.