Occupational Choice, Number of Entrepreneurs and Output: Theory and Empirical Evidence with Spanish Data

Science and Technology Policy Research, Working Paper Series No. 2013-13

Posted: 24 Feb 2016 Last revised: 1 Mar 2016

See all articles by Vicente Salas-Fumás

Vicente Salas-Fumás

University of Zaragoza - Department of Business Administration and Organization

J. Javier Sanchez-Asin

University of Zaragoza - Department of Business Administration and Organization

David Storey

University of Sussex - School of Business, Management and Economics

Multiple version iconThere are 2 versions of this paper

Date Written: November 1, 2013

Abstract

This paper extends the Lucas (1978) model of occupational choices by individuals with different skills, beyond the simple options of self-employment or wage-employment, by including a second choice for the self-employed. That is, an option to hire employees and so become self-employed with employees (SEWEs), or to be self-employed without employees (SEWNEs). We solve for the market equilibrium and examine the sensitivity of relative sizes of occupational groups, and ofthe level of productivity, tochanges in the exogenous parameters. The results show that the positive (negative) association between number of SEWEs (SEWNEs) and productivity, observed in the Spanish data, can be explained, under certain conditions, as the result of cross-region and time differences in average skills. These findings point to the importance of distinguishing between SEWEs and SEWNEs in drawing valid conclusions concerning any link between entrepreneurship and economic development.

Suggested Citation

Salas-Fumás, Vicente and Sanchez-Asin, J. Javier and Storey, David, Occupational Choice, Number of Entrepreneurs and Output: Theory and Empirical Evidence with Spanish Data (November 1, 2013). Science and Technology Policy Research, Working Paper Series No. 2013-13, Available at SSRN: https://ssrn.com/abstract=2736264

Vicente Salas-Fumás

University of Zaragoza - Department of Business Administration and Organization ( email )

Dr. Cerrada 1
5005 Zaragoza
Spain
+34 976 761803 (Phone)

J. Javier Sanchez-Asin

University of Zaragoza - Department of Business Administration and Organization ( email )

Gran Via, 2
Zaragoza, ZARAGOZA 50005
Spain
+34669434726 (Phone)
+34976558549 (Fax)

David Storey (Contact Author)

University of Sussex - School of Business, Management and Economics ( email )

Falmer, Brighton BN1 9SL
United Kingdom

Here is the Coronavirus
related research on SSRN

Paper statistics

Abstract Views
267
PlumX Metrics