Why is there a gender earnings gap in self-employment? A decomposition analysis with German data

Lechmann, Daniel S. J.; Schnabel, Claus

doi:10.1186/2193-9012-1-6

Cited by 31 publications

(36 citation statements)

References 32 publications

(38 reference statements)

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“…in terms of profits, survival, growth rates and income, mainly because women tend to seek work-family balance rather than earning maximization (Klapper and Parker, 2011;Boden, 1999). These differences between male and female entrepreneurs are also reflected in working hours, with women significantly less likely to become full-time self-employed (Gurley-Calvez, Biehl, and Harper, 2009;Lechmann and Schnabel, 2012). 17 Given that we only focus on full-time start-ups (as this is one of the eligibility criteria for subsidy receipt), we are concerned that we would analyze a selected sample of female entrepreneurs (not representative of the entire population of female entrepreneurs), which would limit the external validity of the results for women in this analysis.…”

Section: Empirical Analysismentioning

confidence: 99%

Subsidized start-ups out of unemployment: a comparison to regular business start-ups

et al. 2015

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. www.econstor.eu The Institute for the Study of Labor (IZA) in Bonn is a local and virtual international research center and a place of communication between science, politics and business. IZA is an independent nonprofit organization supported by Deutsche Post Foundation. The center is associated with the University of Bonn and offers a stimulating research environment through its international network, workshops and conferences, data service, project support, research visits and doctoral program. IZA engages in (i) original and internationally competitive research in all fields of labor economics, (ii) development of policy concepts, and (iii) dissemination of research results and concepts to the interested public. Terms of use: Documents in D I S C U S S I O N P A P E R S E R I E SIZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be available directly from the author. Offering unemployed individuals a subsidy to become self-employed is a widespread active labor market policy strategy. Previous studies have illustrated its high effectiveness to help participants escaping unemployment and improving their labor market prospects compared to other unemployed individuals. However, the examination of start-up subsidies from a business perspective has only received little attention to date. Using a new dataset based on a survey allows us to compare subsidized start-ups out of unemployment with regular business founders, with respect to not only personal characteristics but also business outcomes. The results indicate that previously unemployed entrepreneurs face disadvantages in variables correlated with entrepreneurial ability and access to capital. 19 months after start-up, the subsidized businesses experience higher survival, but lag behind regular business founders in terms of income, business growth and innovation. Moreover, we show that expected deadweight losses related to start-up subsidies occur on a (much) lower scale than usually assumed.JEL Classification: C14, L26, J68

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Section: Empirical Analysismentioning

confidence: 99%

Subsidized start-ups out of unemployment: a comparison to regular business start-ups

et al. 2015

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“…This can be attributed to a different motivation, e.g., because more women are seeking a work-family balance instead of earning maximization (Klapper and Parker, 2011;Boden, 1999). This also explains why women are significantly less likely to become full-time self-employed (Gurley-Calvez, Biehl, and Harper, 2009;Lechmann and Schnabel, 2012). As we are interested in the effectiveness of start-up programs to improve labor market prospects of participants, we circumvent these issues by excluding women from the analysis and avoiding side-effects due to differences driven by labor supply decisions of female participants and non-participants.…”

Section: Datamentioning

confidence: 99%

Regional Effect Heterogeneity of Start-up Subsidies for the Unemployed

Caliendo

Künn

2014

Regional Studies

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. www.econstor.eu Recent microeconometric evaluation studies have shown that start-up subsidies for unemployed individuals are an effective policy tool to improve long-term employment and income prospects of participants, in particular compared to other active labor market programs (e.g. training, job search assistance or job creation schemes). What has not been examined yet are the potentially heterogeneous effects of start-up programs across regional labor markets. Labor demand side restrictions in areas with relatively bad labor market conditions generally increase entries into start-up programs as job offers are limited and starting an own business is an opportunity to leave unemployment. However, the survival of firms in deprived areas is also lower, such that the overall effect remains an empirical question. We use a combination of administrative and survey data and observe participants in two distinct start-up programs in Germany for five years after start-up as well as a control group of unemployed who did not enter these programs. We add information on unemployment rates and GDP per capita at the labor agency district level to distinguish regional labor markets. Using propensity score matching methods we find supportive evidence that the founding process and development of businesses as well as program effectiveness is influenced by prevailing economic conditions at start-up. Terms of use: Documents in D I S C U S S I O N P A P E R S E R I E SJEL Classification: J68, R11, C14, H43, L26

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“…Women have less work experience and more career interruptions compared to men, both in the paid-employment and in the self-employment sector. However, this gap is more pronounced in the self-employment sector (Lechmann/Schnabel 2012). Male entrepreneurs have more industry-related experience and for most of them their current business is a replication of their previous job (Carter/Williams 2003;Winn 2005;Walker/Webster 2006;Coleman/Robb 2009;Lechmann/Schnabel 2012).…”

Section: Literature Reviewmentioning

confidence: 99%

“…However, this gap is more pronounced in the self-employment sector (Lechmann/Schnabel 2012). Male entrepreneurs have more industry-related experience and for most of them their current business is a replication of their previous job (Carter/Williams 2003;Winn 2005;Walker/Webster 2006;Coleman/Robb 2009;Lechmann/Schnabel 2012). Similarly, relatively more female entrepreneurs start their business activities without previously working as managers (Greene/Brush/Hart/Saparito 2001;Coughlin/Thomas 2002;Thébaud 2010).…”

Section: Literature Reviewmentioning

confidence: 99%

“…Similarly, state that these three types of experience are particularly important for entrepreneurs, while Cliff (1998) uses these aspects of experience as indicators of the resources needed for entrepreneurial business growth. The length of the general work experience as determinant of entrepreneurial intentions is used in a study of Gupta, Turban, Wasti and Sikdar (2009), while Lechmann and Schnabel (2012) indicate the years of working experience as a determinant of the self-employment earnings. Additionally, Lechmann and Schnabel (2012) find that the length of the current job ownership is an indicator of specific work experience and crucial human capital variable that determines the entrepreneurs' earnings.…”

Section: Variablesmentioning

confidence: 99%

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Differences in the Human Capital of Female and Male Entrepreneurs – Evidence from the Republic of Serbia

Stosic-Panic¹

2017

JEEMS

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The paper explores gender as a rarely studied aspect of entrepreneurship in the Republic of Serbia, with a focus on gender based differences in the components of entrepreneurs' human capital. The results indicate that the expected relationship between entrepreneurs' gender and the components of human capital was found in most cases. There were statistically significant differences regarding the field of education, the existence of previous management and prior entrepreneurial (ownership) experience, as well as differences related to the entrepreneurial self-efficacy in the field of marketing and general management. All these differences are in favour of male entrepreneurs.

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Why is there a gender earnings gap in self-employment? A decomposition analysis with German data

Cited by 31 publications

References 32 publications

Subsidized start-ups out of unemployment: a comparison to regular business start-ups

Subsidized start-ups out of unemployment: a comparison to regular business start-ups

Regional Effect Heterogeneity of Start-up Subsidies for the Unemployed

Differences in the Human Capital of Female and Male Entrepreneurs – Evidence from the Republic of Serbia

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