Self-employment convergence in Europe: The role of migration

Abstract

This paper attempts to identify patterns of convergence in the rates of self-employment (SE) for both foreign-born and natives in a sample of 17 European countries during the period 1999–2018. A distinction is made between self-employed with and without workers. Our analysis is relevant for policy-making: whether or not there is evidence of convergence in SE rates can be an indication of the homogeneity of self-employed workers among the countries analysed, which in turn may reflect the success of the EU-wide policies to boost SE.

Clusters in foreign-born vs. native self-employment in Europe: do we look alike?

“…Our findings show that, whereas natives behave differently in peripheral and core countries, their foreign-born self-employed counterparts seem to behave similarly across different recipient countries 2 . These outcomes support previous findings reported by Cuadros et al (2021) and indicate that the economic context of the receiving country seems to exert a stronger influence on natives than 1 A cluster is a group of observations with similar characteristics. Thus, they hold a high degree of both internal homogeneity (inside cluster) and external heterogeneity (among clusters).…”

“…Focusing on the case of 4 clusters in Figure 2, we obtain two bigger groups, but smaller than those in Figure 1; the first one contains a mixture of peripheral and core economies, a second group is composed of Central and Eastern European countries, and there are two more small groups with Southern European countries. As suggested in Cuadros et al (2021), this implies that natives' SE rates seem to be more dissimilar than those of foreign-born individuals, and we see a greater presence of idiosyncratic features in natives, with immigrants tending to be more homogenous.…”

“…The promotion of entrepreneurship has been seen as an important driver of economic growth, job creation and higher market competition due to an increase in the number of businesses (see Thurik, 2009;Cuadros et al 2021, andFaria et al, 2020, among many others). Thurik (2003) raises the problem of unemployment in those countries where the transition from a managed to an entrepreneurial economy does not take place at the desired pace.…”

“…In this paper, we analyse how (dis)similar the SE rates are among a pool of European countries, distinguishing whether the self-employed individuals are native or foreign-born. To the best of our knowledge, only Cuadros et al (2021) have analysed convergence in SE rates (by using unit root analysis for panels) in order to examine whether the SE rates converge to an average for both native and foreign-born self-employed populations. This study shows that the SE rates for migrants behave more similarly than those for natives.…”

Attitude of youth towards self-employment: Evidence from university students in Yemen

“…The role of entrepreneurship in economic development has received increasing attention since evidence has proven that entrepreneurship generates the most economic activity [1][2][3]. Countries with high unemployment rates where economic systems search for alternative methods to provide employment usually have economic institutions with focused policies to facilitate selfemployment in the general population, especially for university graduates [4][5][6]. Today, the unemployment rate among the highly-educated population is proportionally more than the less-educated population [4,7].…”