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Does entrepreneurship pay for women and immigrants? A 30 year assessment of the socio-economic impact of entrepreneurial activity in Germany

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  • Christian Hopp
  • Johannes Martin

Abstract

Using data from the German Socio-Economic Panel from 1984 to 2012, we explore income effects of self-employment for females and migrants. Controlling for the selection into self-employment, we differentiate the overall earnings differential between the self-employed and the wage-employed into an endowment effect (they are equipped with characteristics that positively affect earnings in either occupation) and a treatment effect (the income effect solely due to the decision for self-employment). We find that women exhibit both a lower treatment effect and a lower endowment effect than men. Migrants benefit much more from entrepreneurial activities than Germans, having a significantly higher treatment effect. Among the countries of origin, Turkish migrants benefit the most from their self-employment decision, while southern Europeans exhibit the lowest income relevant skills.

Suggested Citation

  • Christian Hopp & Johannes Martin, 2017. "Does entrepreneurship pay for women and immigrants? A 30 year assessment of the socio-economic impact of entrepreneurial activity in Germany," Entrepreneurship & Regional Development, Taylor & Francis Journals, vol. 29(5-6), pages 517-543, May.
    • Handle: RePEc:taf:entreg:v:29:y:2017:i:5-6:p:517-543
    DOI: 10.1080/08985626.2017.1299224
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    References listed on IDEAS

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    1. Amelie Constant & Yochanan Shachmurove & Klaus F. Zimmermann, 2005. "The Role of Turkish Immigrants in Entrepreneurial Activities in Germany," PIER Working Paper Archive 05-029, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania.
    2. Nils Braakmann, 2007. "Differences in the earnings distribution of self- and dependent emploxed German men - evidence from a quantile regression decomposition analysis," Working Paper Series in Economics 55, University of Lüneburg, Institute of Economics.
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    2. Raymond K. Van Ness & Charles F. Seifert & Janet H. Marler & William J. Wales & Mark E. Hughes, 2020. "Proactive Entrepreneurs: Who Are They and How Are They Different?," Journal of Entrepreneurship and Innovation in Emerging Economies, Entrepreneurship Development Institute of India, vol. 29(1), pages 148-175, March.
    3. Lin Xiu & Morley Gunderson, 2021. "Does an Entrepreneurial Career Pay for Women in China?," British Journal of Industrial Relations, London School of Economics, vol. 59(1), pages 167-190, March.
    4. Elaine Laing & André Stel & David J. Storey, 2022. "Formal and informal entrepreneurship: a cross-country policy perspective," Small Business Economics, Springer, vol. 59(3), pages 807-826, October.
    5. Aleksandra Gawel & Timo Toikko, 2021. "Trust in European Institutions in Explaining the Entrepreneurship in European Union Countries," Social Sciences, MDPI, vol. 10(6), pages 1-16, May.
    6. Hundera, Mulu, 2019. "Role conflict, coping strategies and female entrepreneurial success in sub-Saharan Africa," Other publications TiSEM 3e263b0c-3bf3-474a-8a20-b, Tilburg University, School of Economics and Management.
    7. Dabić, Marina & Vlačić, Bozidar & Paul, Justin & Dana, Leo-Paul & Sahasranamam, Sreevas & Glinka, Beata, 2020. "Immigrant entrepreneurship: A review and research agenda," Journal of Business Research, Elsevier, vol. 113(C), pages 25-38.

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