Self-Employment and Mental Health

32 Pages Posted: 4 May 2013 Last revised: 11 Sep 2014

See all articles by Vicki L. Bogan

Vicki L. Bogan

Cornell University

Angela R. Fertig

University of Minnesota - Twin Cities

David R. Just

Cornell University - Dyson School of Applied Economics and Management

Date Written: September 2014

Abstract

This paper analyzes the role of mental health in self-employment decisions. Using panel data, we find evidence of a causal relationship between mental health problems and self-employment. The relationship depends on the type of self-employment and severity of mental health issues. For men, having moderate psychological distress decreases the probability of being self-employed in an incorporated business between 1 and 3 percent and increases the probability of pursuing self-employment in an unincorporated business between 1 and 3 percent. For women, having moderate psychological distress increases the probability of pursuing self-employment in an unincorporated business between 1 and 2 percent. Further, our results suggest that individual difficulty in the wage-and-salary employment market is the likely mechanism for this connection between mental health and self-employment.

Keywords: Entrepreneurship, self-employment, occupational choice, mental health, depression

JEL Classification: J24, J23

Suggested Citation

Bogan, Vicki L. and Fertig, Angela R. and Just, David R., Self-Employment and Mental Health (September 2014). Available at SSRN: https://ssrn.com/abstract=2259765 or http://dx.doi.org/10.2139/ssrn.2259765

Vicki L. Bogan (Contact Author)

Cornell University ( email )

Warren Hall
Ithaca, NY 14853
United States
607-254-7219 (Phone)

Angela R. Fertig

University of Minnesota - Twin Cities ( email )

420 Delaware St. SE
Minneapolis, MN 55455
United States

David R. Just

Cornell University - Dyson School of Applied Economics and Management ( email )

Ithaca, NY
United States
607-255-2086 (Phone)
607-255-9984 (Fax)

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