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Financial Development, Entrepreneurship, and Job Satisfaction

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  • Milo Bianchi

    (DRM - Dauphine Recherches en Management - Université Paris Dauphine-PSL - PSL - Université Paris Sciences et Lettres - CNRS - Centre National de la Recherche Scientifique)

Abstract

This paper shows that utility differences between the self-employed and employees increase with financial development. This effect is not explained by increased profits but by an increased value of non-monetary benefits, in particular job independence. We interpret these findings by building a simple occupational choice model in which financial constraints may impede the creation of firms and depress labor demand, thereby pushing some individuals into self-employment for lack of salaried jobs. In this setting, financial development favors a better matching between individual motivation and occupation, thereby increasing entrepreneurial utility despite increasing competition and so reducing profits.

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  • Milo Bianchi, 2012. "Financial Development, Entrepreneurship, and Job Satisfaction," Post-Print halshs-00670031, HAL.
    • Handle: RePEc:hal:journl:halshs-00670031
    Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00670031
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    More about this item

    Keywords

    Financial development; entrepreneurship; job satisfaction;
    All these keywords.

    JEL classification:

    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • J20 - Labor and Demographic Economics - - Demand and Supply of Labor - - - General

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