The Pleasures and Pains of Self-Employment: A Panel Data Analysis of Satisfaction with Life, Work, and Leisure

Tinbergen Institute Discussion Paper 15-099/VII

39 Pages Posted: 19 Aug 2015

See all articles by Peter van der Zwan

Peter van der Zwan

Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE)

Jolanda Hessels

Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE)

Cornelius A. Rietveld

Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE)

Date Written: August 18, 2015

Abstract

We investigate how a transition from paid employment to self-employment in the labor market influences life satisfaction. Furthermore, we consider the dynamics of work and leisure satisfaction because the balance between work and leisure is an important element of life satisfaction. Fixed-effects regressions using German Socio-Economic Panel data (1984-2012) reveal that switching to self-employment benefits life and work satisfaction. The effects on life satisfaction are weak and temporary, but they are pronounced and relatively persistent for work satisfaction. However, the gain in work satisfaction is outweighed by a decrease in leisure satisfaction, thus placing work-life balance under severe pressure.

Keywords: Self-employment, Entrepreneurship, Life satisfaction, Work satisfaction, Work-life balance

JEL Classification: I31, J24, J28, J31, L26

Suggested Citation

van der Zwan, Peter and Hessels, Jolanda and Rietveld, Cornelius A., The Pleasures and Pains of Self-Employment: A Panel Data Analysis of Satisfaction with Life, Work, and Leisure (August 18, 2015). Tinbergen Institute Discussion Paper 15-099/VII, Available at SSRN: https://ssrn.com/abstract=2646607 or http://dx.doi.org/10.2139/ssrn.2646607

Peter Van der Zwan (Contact Author)

Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE) ( email )

P.O. Box 1738
3000 DR Rotterdam, NL 3062 PA
Netherlands

Jolanda Hessels

Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE) ( email )

P.O. Box 1738
3000 DR Rotterdam, NL 3062 PA
Netherlands

Cornelius A. Rietveld

Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE) ( email )

P.O. Box 1738
3000 DR Rotterdam, NL 3062 PA
Netherlands

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