Transition to and from Self-Employment in Spain: An Empirical Analysis

• Raquel Carrasco ^[1]
  1. [1] Centro de Estudios Monetarios y Financieros

     Centro de Estudios Monetarios y Financieros

     Madrid, España

     
• Localización: Documentos de Trabajo ( CEMFI ), Nº. 10 (CEMFI Working Paper No. 9710, July 1997), 1997
• Idioma: inglés
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• Resumen

  • This paper investigates the influence of individual characteristics and the business cycle on the probability of entry into self-employment and on self-employment duration. We estimate multinomial logit and discrete competing risks models using data from a longitudinal sample of Spanish men for the period 1985-1991. The results indicate that unemployment rises the probability of entering self-employment, but also increases the hazard of leaving self-employment, specially into unemployment. Moreover, receiving unemployment benefits significantly reduces the probability of entering self-employment. Liquidity constraints are important in determining entrepreneurial selection, but only for those who become self-employed with employees.