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

Figures & data

Figure 1. Entrepreneurial characteristics and outcome comparison.

Table 1. Sample.

Variable	Wage-employed (148,068)	Self-employed (n = 12,622)
Ln(gross monthly income in prices of 2012)	7.85	8.04
Socio-demographic characteristics
Female (1 = yes)	0.332	0.247
Migrant (1 = yes)	0.163	0.095
Married (1 = yes)	0.668	0.729
Child under 16 in household (1 = yes)	0.382	0.410
Age (in years)	40.5	44.9
Satisfaction with health (from 0 ‘totally dissatisfied’ to 10 ‘totally satisfied’)	7.01	7.02
Human capital
Schooling (in years)	12.0	13.1
Fulltime experience (in years)	17.8	20.5
Parttime experience (in years)	0.772	1.01
Unemployment experience (in years)	0.374	0.404
Job-specific factors
In occupation trained for (1 = yes)	0.582	0.638
Tenure (years)	11.3	10.4
Weekly working time (h)	42.9	51.9
Entrepreneurial activities of the parents
Father self-employed (1 = yes)	0.080	0.182
Mother self-employed (1 = yes)	0.008	0.018

Table 2. Earnings regressions (monthly income) – Endogenous switching model.

	Endogenous switching model
	1 = self-employed	Income in Self-employment (Y1)	Income in Wage-employment (Y0)
Schooling	0.034*** (0.002)	0.048*** (0.003)	0.061*** (0.0004)
Fulltime experience	−0.017*** (0.001)	0.007*** (0.002)	0.002*** (0.0003)
Parttime experience	−0.001 (0.002)	−0.008** (0.003)	−0.007*** (0.0005)
Unemployment experience	−0.022*** (0.006)	−0.060*** (0.006)	−0.029*** (0.001)
Female	−0.074*** (0.015)	−0.300*** (0.017)	−0.175*** (0.002)
Migrant	−0.099*** (0.019)	0.088*** (0.021)	−0.045*** (0.003)
Married	−0.027** (0.014)	0.064*** (0.015)	0.044*** (0.002)
Child	0.175*** (0.013)	0.096*** (0.016)	0.054*** (0.002)
Age	0.046*** (0.001)	−0.002 (0.002)	0.005*** (0.0003)
Satisfaction with health	0.020*** (0.003)	0.020*** (0.003)	0.006*** (0.0005)
In occupation trained for	0.127*** (0.012)	0.002 (0.015)	0.061*** (0.002)
Tenure	−0.010*** (0.001)	0.002*** (0.001)	0.005*** (0.0001)
Weekly working time	0.041*** (0.001)	0.008*** (0.002)	0.008*** (0.0002)
Father self-employed	0.399*** (0.017)
Mother self-employed	0.037 (0.051)
Industry and public sector dummies	Yes	Yes	Yes
Region dummies	Yes	Yes	Yes
Year dummies	Yes	Yes	Yes
Constant	−5.115*** (0.079)	6.739*** (0.253)	6.295*** (0.013)
Observations	160,690
Rho		−0.030*** (0.006)	0.069 (0.080)
Wald test of independent equations	χ^2(1) = 25.17, Prob > χ^2 = 0.000

Note: Robust standard errors in parentheses.

* Significant at the 10% level

** significant at the 5% level

*** significant at the 1% level.

Table 3. Earnings regressions (hourly income) – Endogenous switching model.

	Endogenous switching model
	1 = self-employed	Income in Self-employment (Y1)	Income in Wage-employment (Y0)
Schooling	0.048*** (0.002)	0.051*** (0.004)	0.056*** (0.0005)
Fulltime experience	−0.012*** (0.001)	0.003 (0.002)	0.002*** (0.0003)
Parttime experience	−0.004 (0.002)	−0.005* (0.002)	−0.005*** (0.001)
Unemployment experience	−0.033*** (0.005)	−0.057*** (0.007)	−0.028*** (0.001)
Female	−0.231*** (0.014)	−0.261*** (0.022)	−0.143*** (0.002)
Migrant	−0.145*** (0.018)	0.092*** (0.025)	−0.009*** (0.003)
Married	−0.006 (0.014)	0.038*** (0.016)	0.034*** (0.003)
Child	0.195*** (0.123)	0.094*** (0.019)	0.054*** (0.002)
Age	0.043*** (0.001)	0.005 (0.003)	0.005*** (0.0003)
Satisfaction with health	0.015*** (0.003)	0.020*** (0.003)	0.007*** (0.001)
In occupation trained for	0.111*** (0.012)	0.001 (0.016)	0.063*** (0.002)
Tenure	−0.138*** (0.001)	0.001 (0.001)	0.006*** (0.0001)
Father self-employed	0.435*** (0.016)
Mother self-employed	0.042 (0.049)
Industry and public sector dummies	Yes	Yes	Yes
Region dummies	Yes	Yes	Yes
Year dummies	Yes	Yes	Yes
Constant	3.175*** (0.060)	1.411*** (0.249)	1.143*** (0.012)
Observations	160,690
Rho		−0.013 (0.009)	0.128 (0.094)
Wald test of independent equations	χ^2(1) = 3.64, Prob > χ^2 = 0.057

Note: Robust standard errors in parentheses.

* Significant at the 10% level

** significant at the 5% level

*** significant at the 1% level.

Table 4. Treatment effects based on OLS – Oaxaca–Blinder decomposition and endogenous switching model (monthly income).

	n	Basic model		Switching model
		Treatment effect	Endowment effect	Treatment effect	Endowment effect
All	12,622	0.012** (0.006)	0.177*** (0.003)	0.029*** (0.001)	0.160*** (0.003)
Male	9505	0.027*** (0.007)	0.178*** (0.003)	0.044*** (0.002)	0.161*** (0.003)
Female	3117	−0.036** (0.013)	0.077*** (0.005)	−0.085*** (0.004)	0.119*** (0.005)
German	11,420	−0.014** (0.006)	0.176*** (0.003)	0.005*** (0.001)	0.168*** (0.003)
Migrant	1202	0.236*** (0.018)	0.125*** (0.007)	0.257*** (0.006)	0.104*** (0.007)
Turkey	287	0.370*** (0.033)	0.062*** (0.013)	0.279*** (0.020)	0.153*** (0.013)
South Europe	573	0.242*** (0.024)	0.103*** (0.009)	0.218*** (0.011)	0.124*** (0.009)
West/North/East Europe	236	0.226*** (0.019)	0.096* (0.053)	0.193*** (0.033)	0.129*** (0.019)

Notes: Standard errors in parentheses. The effects for the basic model are computed on the base of unconditional OLS-type income regressions as described in Section 3.2.1.

* Significant at the 10% level

** significant at the 5% level; ***significant at the 1% level.

Table 5. Treatment effects based on OLS – Oaxaca–Blinder decomposition and endogenous switching model (hourly income).

	n	Basic model		Switching model
		Treatment effect	Endowment effect	Treatment effect	Endowment effect
All	12,622	−0.049*** (0.006)	0.076*** (0.003)	−0.040*** (0.001)	0.068*** (0.003)
Male	9505	−0.035*** (0.007)	0.067*** (0.003)	−0.026*** (0.001)	0.058*** (0.003)
Female	3117	−0.091*** (0.014)	0.025*** (0.005)	−0.151*** (0.003)	0.082*** (0.005)
German	11,420	−0.069*** (0.007)	0.083*** (0.003)	−0.082*** (0.001)	0.096*** (0.003)
Migrant	1202	0.127*** (0.020)	−0.002 (0.006)	0.183*** (0.006)	−0.058*** (0.006)
Turkey	287	0.232*** (0.039)	−0.052*** (0.012)	0.158*** (0.023)	0.024* (0.012)
South Europe	573	0.084*** (0.028)	−0.028*** (0.008)	0.071*** (0.011)	−0.015* (0.008)
West/North/East Europe	236	0.078 (0.055)	0.114*** (0.017)	0.204*** (0.028)	−0.012 (0.017)

Notes: Standard errors in parentheses. The effects for the basic model are computed on the base of unconditional OLS-type income regressions as described in Section 3.2.1.

* Significant at the 10% level

** significant at the 5% level

*** significant at the 1% level

Figure 2. European milestones in the observation period.

Figure 3. Treatment vs. endowment effects – Time trends.

Note: Tabulated with 95% confidence intervals.

Table

Variable	Description
Self-employed	Dummy for a self-employed worker
Gross monthly income	Monthly income in Euro of prices in 2012: wages and salaries for wage-employed people, retained earnings for self-employed people
Father self-employed	Dummy if the father was self-employed at individual’s age of 15
Mother self-employed	Dummy if the mother was self-employed at individual’s age of 15
Fulltime experience	Cumulated years of fulltime work during the whole working life
Parttime experience	Cumulated years of parttime work during the whole working life
Unemployment experience	Cumulated years of unemployment during the whole working life
Satisfaction with health	Satisfaction with individual health status from 0 ‘totally dissatisfied’ to 10 ‘totally satisfied’
Female	Dummy for a female worker
Migrant	Dummy for a worker who was not born in Germany
Child under 16 in household	Dummy for a worker with at least one child under the age of 16 in her/his household
Age	Current age of the worker (in years)
Schooling	Years of education at school and university (7 = no schooling degree, 18 = university degree)
In occupation trained for	Dummy for a worker whose occupation is the same in which she/he was trained
Tenure	Tenure with the current firm (in years)
Weekly working time	Actual working time per week (in hours)