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Self-Employment, Educational Attainment and Employment Protection LegislationTobias BrändleUniversity of Tuebingen; Institute for Applied Economic Research (IAW) Florian BaumannUniversity of Tuebingen - Faculty of Economics and Business Administration February 7, 2012 Abstract: We analyse how educational attainment and employment protection influence an individual’s decision to become self-employed. By altering expected income from dependent employment, employment protection is likely to affect an individual’s choice of occupation, although such a link has not been established in the literature so far. We argue that an interaction between an individual’s educational attainment and the institution of employment protection exists when it comes to the decision regarding whether to become self-employed. Based on survey data from OECD countries, we find evidence for such a negative interaction, and find that only after taking this interaction into account can the effect of employment protection on self-employment rates be assessed.
Number of Pages in PDF File: 39 Keywords: education, employment protection legislation, occupational choice, self- employment JEL Classification: J24, J63 working papers seriesDate posted: March 21, 2012Suggested CitationContact Information
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