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

Abstract

Using data from the German SocioEconomic 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 selfemployed 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 selfemployment decision, while southern Europeans exhibit the lowest income relevant skills.

Can beneficial antecedents to self‐employment be detrimental to entrepreneurial performance?

“…We relegate more detailed definitions and explanations of our variables to Appendix . Overall, self‐employed individuals significantly differ from wage‐employed people in most variables used in our analysis: Entrepreneurs earn on average 10% more per month than their employed counterparts, which is in line with prior work employing German data (see, e.g., Fritsch, Kritikos, & Rusakova, , and Hopp & Martin, ). They score higher on both plasticity and stability.…”

Female Entrepreneurship and the Metanarrative of Economic Growth: A Critical Review of Underlying Assumptions

“…A study by Adachi and Hisada (2017) finds that the impact of children's presence on women's choice for entrepreneurship is not statistically significant. In addition, women business owners have been found to work longer hours than waged-employed women (Hopp and Martin (2017) and have shorter parental leave (Anxo and Ericson 2015). In fact, Anxo and Ericson (2015) reject that the motives of Swedish women to become entrepreneurs is related to worklife balance issues after noting the shorter average duration of parental leave among female self-employed.…”

Does an Entrepreneurial Career Pay for Women in China?

“…Seeking an entrepreneurial career has been seen as a way to foster economic growth and higher income levels as well as socioeconomic status (Hopp and Martin 2017; Luo and Chong 2019). Increasing attention has been paid to the experience of women entrepreneurs (Grekou et al .…”

“…2019; Thébaud 2015) for various reasons. Compared to male entrepreneurs, female entrepreneurs tend to have different personal and demographic characteristics (Cowling and Taylor 2001), follow different motives to choose an entrepreneurial career (Hopp and Martin 2017), experience different financial and social barriers and opportunities (McAdam et al . 2019) and receive different monetary returns to entrepreneurship (Loscocco and Bird 2012).…”