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

34 Pages Posted: 8 Oct 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 analyse how an entry regulation that imposes a mandatory educational standard affects entry into self-employment and occupational mobility. We exploit German reunification as a natural experiment and identify regulatory effects by comparing differences between regulated and unregulated occupations in East Germany with 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.

Suggested Citation

Prantl, Susanne and Spitz-Oener, Alexandra, How Does Entry Regulation Influence Entry into Self-Employment and Occupational Mobility?. Economics of Transition, Vol. 17, Issue 4, pp. 769-802, October 2009, Available at SSRN: https://ssrn.com/abstract=1484312 or http://dx.doi.org/10.1111/j.1468-0351.2009.00374.x

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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