This paper investigates the influence of individual characteristics and the business cycle on the probability of entry into self‐employment and on self‐employment duration. We estimate multinomial logit and discrete competing risks models using data from a longitudinal sample of Spanish men for the period 1985–1991. The results indicate that unemployment raises the probability of entering self‐employment, but also increases the hazard of leaving self‐employment, especially into unemployment. Moreover, receiving unemployment benefits significantly reduces the probability of entering self‐employment. Liquidity constraints are important in determining enterpreneurial selection, but only for those who become self‐employed with employees.
We present a class of binary choice models for panel data with the following features: (i) The explanatory variables are predetermined but not strictly exogenous. This includes lagged dependent variables as well as other forms of unspeciÿed feedback. (ii) Individual e ects are allowed to be correlated with the explanatory variables. Dependence is speciÿed through the conditional expectation of the e ects which is let to be non-parametric. We also present a GMM estimator for these models, which is consistent and asymptotically normal for ÿxed T and large N . We study its ÿnite sample properties in an autoregressive model by means of Monte Carlo simulations. Finally, as an empirical illustration, we estimate a female labour force participation equation with predetermined children using PSID data.JEL classiÿcation: C23
This paper provides an approximation to the labor market effects of immigrants in Spain, a country where labor market institutions and immigration policy exhibit some peculiarities, during the second half of the 1990s, the period in which immigration flows accelerated. By using alternative data sets, we estimate both the impact of legal and total immigration flows on the employment rates and wages of native workers, accounting for the possible occupational and geographical mobility of immigrants and native-born workers. Using different samples and estimation procedures, we have not found a significant negative effect of immigration on either the employment rates or wages of native workers.
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