Microentrepreneurship and the business cycle
Subtitle: is self-employment a desired outcome?
By: Federico S. Mandelman and Gabriel V. Montes Rojas
Contributors: Montes Rojas, Gabriel V.; Federal Reserve Bank of Atlanta
Series: Working paper series / Federal Reserve Bank of Atlanta -- 2007-15; Working paper series (Federal Reserve Bank of Atlanta : Online) -- 2007-15.
Publisher: Federal Reserve Bank of Atlanta
Published: 2007
Place of publication: Atlanta, Ga.]
Language: eng
Format: [electronic resource] :
Description: "This paper links employment dynamics to the business cycle in order to examine the voluntary nature of self-employment in Argentina.  Our results suggest that the transition to self-employment is more common during recessions and that the likelihood of becoming self-employed increases with the length of the recession and the unemployment duration.  We find that the majority of self-employed workers do not have employees and earn significantly less than salaried workers.  Individuals in this sector are often young and less educated and have trouble obtaining a salaried position regardless of the macroeconomic conditions.  Middle-aged, college-educated individuals also tend to enter self-employment as a temporary refuge when they encounter difficulties during a recession.  Our results suggest, however, that for entrepreneurs who have employees, entry into self-employment is procyclical and voluntary and has characteristics similar to those predicted for highly skilled risk-taking entrepreneurs.  Including idiosyncratic entrepreneurial abilities in a standard job search model allows us to predict such labor market segmentation and the cyclical pattern of entrance into self-employment"--Federal Reserve Bank of Atlanta web site.
Notes: Title from PDF file as viewed on 7/23/2007.

Includes bibliographical references.

Also available in print.

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Mode of access: World Wide Web.