The perceived well-being and health costs of exiting self-employment
We explore how involuntary and voluntary exits from self-employment affect life and health satisfaction. To that end, we use rich longitudinal data from the German Socio-Economic Panel from 1985 to 2017 and a difference-in-differences estimation. Our findings suggest that while transitioning from se...
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| Format: | Elektronisch E-Book |
| Sprache: | English |
| Veröffentlicht: |
Regensburg
Leibniz Institute for Eastern and Southeastern European Studies
May 2020
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| Schriftenreihe: | IOS working papers
No. 386 |
| Online-Zugang: | kostenfrei |
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| Zusammenfassung: | We explore how involuntary and voluntary exits from self-employment affect life and health satisfaction. To that end, we use rich longitudinal data from the German Socio-Economic Panel from 1985 to 2017 and a difference-in-differences estimation. Our findings suggest that while transitioning from self-employment to salaried employment (i.e., a voluntary selfemployment exit) brings small improvements in health and life satisfaction, the negative psychological costs of business failure (i.e., switching from self-employment to unemployment) are substantial and exceed the costs of involuntarily losing a salaried job (i.e., switching from salaried employment to unemployment). Meanwhile, leaving self-employment has no consequences for self-reported physical health and behaviors such as smoking and drinking, implying that the costs of losing self-employment are largely psychological. Moreover, former business owners fail to adapt to an involuntary self-employment exit even two or more years after this traumatic event. Our findings imply that policies encouraging entrepreneurship should also carefully consider the costs of business failure. |
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| Beschreibung: | 1 Online-Ressource (v, 40 Seiten) Diagramme |