How Does Entry Regulation Influence Entry into Self-Employment and Occupational Mobility?

38 Pages Posted: 21 Jun 2009

See all articles by Susanne Prantl

Susanne Prantl

Max Planck Society for the Advancement of the Sciences - Max Planck Institute for Research on Collective Goods

Alexandra Spitz-Oener

Humboldt University of Berlin; Government of the Federal Republic of Germany - Institute for Employment Research (IAB); IZA Institute of Labor Economics

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Abstract

We analyze how an entry regulation that imposes a mandatory educational standard affects entry into self-employment and occupational mobility. We exploit the German reunification as a natural experiment and identify regulatory effects by comparing differences between regulated occupations and unregulated occupations in East Germany to the corresponding differences in West Germany after reunification. Consistent with our expectations, we find that entry regulation reduces entry into self-employment and occupational mobility after reunification more in regulated occupations in East Germany than in West Germany. Our findings are relevant for transition or emerging economies as well as for mature market economies requiring large structural changes after unforeseen economic shocks.

Keywords: occupational mobility, self-employment, entry regulation

JEL Classification: J24, J62, K20, L11, L51, M13

Suggested Citation

Prantl, Susanne and Spitz-Oener, Alexandra, How Does Entry Regulation Influence Entry into Self-Employment and Occupational Mobility?. IZA Discussion Paper No. 4221. Available at SSRN: https://ssrn.com/abstract=1423337

Susanne Prantl (Contact Author)

Max Planck Society for the Advancement of the Sciences - Max Planck Institute for Research on Collective Goods ( email )

Kurt-Schumacher-Str. 10
D-53113 Bonn, 53113
Germany

Alexandra Spitz-Oener

Humboldt University of Berlin ( email )

Unter den Linden 6
Berlin, AK Berlin 10099
Germany

Government of the Federal Republic of Germany - Institute for Employment Research (IAB) ( email )

Germany

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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