Abstract

http://ssrn.com/abstract=2230099
 
 

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Health Insurance and the Supply of Entrepreneurs: New Evidence from the Affordable Care Act's Dependent Coverage Mandate


James B. Bailey


Creighton University - Department of Economics; Temple University - Department of Economics

March 7, 2013


Abstract:     
Abstract Is the difficulty of purchasing health insurance as an individual or small business a major barrier to entrepreneurship in the United States? I answer this question by taking advantage of the natural experiment provided by the Affordable Care Act’s dependent coverage mandate, which allowed many 19-25 year-olds to acquire health insurance independently of their employment. A naive difference-in-difference strategy finds that the dependent coverage mandate led to a substantial increase in self-employment among young adults. However, a closer examination of the proper control group together with placebo tests reveals that the naive estimate is not robust, and that the mandate did not truly increase self-employment. This suggests that lack of health insurance and “entrepreneurship lock” have not been major barriers to self-employment for young adults.

Number of Pages in PDF File: 26

Keywords: Health Insurance, Self-Employment, Entrepreneurship Lock, Affordable Care Act, Dependent Coverage Mandate

JEL Classification: L26, J20, I13, I18, M13


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Date posted: March 9, 2013 ; Last revised: January 20, 2015

Suggested Citation

Bailey, James B., Health Insurance and the Supply of Entrepreneurs: New Evidence from the Affordable Care Act's Dependent Coverage Mandate (March 7, 2013). Available at SSRN: http://ssrn.com/abstract=2230099 or http://dx.doi.org/10.2139/ssrn.2230099

Contact Information

James B. Bailey (Contact Author)
Creighton University - Department of Economics ( email )
2500 California Plaza
Omaha, NE 68178
United States
Temple University - Department of Economics ( email )
Philadelphia, PA 19122
United States
HOME PAGE: http://sites.temple.edu/jamesbailey/
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