On the misery of losing self-employment

On the misery of losing self-employment Using German panel data, this study compares responses of self-employed workers’ well-being and paid employees’ well-being to the loss of work. The empirical analyses show that life satisfaction decreases substantially more in the probability of losing work when self-employed than when paid-employed. It also turns out that becoming unemployed yields a much stronger decline in self-employed workers’ life satisfaction than in paid employees’ life satisfaction. Although these results do not necessarily represent causal effects, they indicate that losing self-employment is an even more harmful life event than losing dependent employment. Further analyses substantiate this conclusion. It is also shown that non-monetary reasons may explain much more than monetary reasons why the self-employed seem to suffer in particular from unemployment. In addition, the difference in the responses of well-being to unemployment between self-employed workers and paid-employed workers originates from varying levels of life satisfaction after terminating work, but not from divergent levels of life satisfaction before terminating work. One implication of these findings is that the potential psychological cost of unemployment might constitute a risk that prevents workers from going into business by themselves. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Small Business Economics Springer Journals

On the misery of losing self-employment

Loading next page...
 
/lp/springer_journal/on-the-misery-of-losing-self-employment-S4DuYkKm04
Publisher
Springer US
Copyright
Copyright © 2016 by Springer Science+Business Media New York
Subject
Business and Management; Management; Microeconomics; Entrepreneurship; Industrial Organization
ISSN
0921-898X
eISSN
1573-0913
D.O.I.
10.1007/s11187-016-9730-0
Publisher site
See Article on Publisher Site

Abstract

Using German panel data, this study compares responses of self-employed workers’ well-being and paid employees’ well-being to the loss of work. The empirical analyses show that life satisfaction decreases substantially more in the probability of losing work when self-employed than when paid-employed. It also turns out that becoming unemployed yields a much stronger decline in self-employed workers’ life satisfaction than in paid employees’ life satisfaction. Although these results do not necessarily represent causal effects, they indicate that losing self-employment is an even more harmful life event than losing dependent employment. Further analyses substantiate this conclusion. It is also shown that non-monetary reasons may explain much more than monetary reasons why the self-employed seem to suffer in particular from unemployment. In addition, the difference in the responses of well-being to unemployment between self-employed workers and paid-employed workers originates from varying levels of life satisfaction after terminating work, but not from divergent levels of life satisfaction before terminating work. One implication of these findings is that the potential psychological cost of unemployment might constitute a risk that prevents workers from going into business by themselves.

Journal

Small Business EconomicsSpringer Journals

Published: Apr 21, 2016

References

You’re reading a free preview. Subscribe to read the entire article.


DeepDyve is your
personal research library

It’s your single place to instantly
discover and read the research
that matters to you.

Enjoy affordable access to
over 12 million articles from more than
10,000 peer-reviewed journals.

All for just $49/month

Explore the DeepDyve Library

Unlimited reading

Read as many articles as you need. Full articles with original layout, charts and figures. Read online, from anywhere.

Stay up to date

Keep up with your field with Personalized Recommendations and Follow Journals to get automatic updates.

Organize your research

It’s easy to organize your research with our built-in tools.

Your journals are on DeepDyve

Read from thousands of the leading scholarly journals from SpringerNature, Elsevier, Wiley-Blackwell, Oxford University Press and more.

All the latest content is available, no embargo periods.

See the journals in your area

DeepDyve Freelancer

DeepDyve Pro

Price
FREE
$49/month

$360/year
Save searches from
Google Scholar,
PubMed
Create lists to
organize your research
Export lists, citations
Read DeepDyve articles
Abstract access only
Unlimited access to over
18 million full-text articles
Print
20 pages/month
PDF Discount
20% off