New Evidence on the Relationship between Risk Attitudes and Self-Employment

Olga Skriabikova, Thomas Dohmen and Ben Kriechel

No 8354, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper analyses the impact of risk attitudes on the decision to become self-employed among individuals who grew up under the communist regime in Ukraine, which banned self-employment so that individuals could not observe what it is like to be self-employed. Since the intra-family transmission of self-employment experiences was largely shut down, the observed correlation between risk preferences and self-employment after transition is unlikely to be driven by parents transmitting self-employment experience and risk preferences to their children. Robustness checks on a sample of East Germans confirm that such a third factor explanation is implausible, thus shedding light on the causal nature of the relation between risk preferences and the decision to become self-employed.

Keywords: ULMS; risk attitudes; self-employment; intergenerational transmission of self-employment and risk attitudes; SOEP (search for similar items in EconPapers)
JEL-codes: D81 J24 P3 (search for similar items in EconPapers)
Pages: 25 pages
Date: 2014-07
New Economics Papers: this item is included in nep-ent, nep-lab, nep-ltv and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (65)

Published - published in: Labour Economics, 2014, 30, 176-184

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Journal Article: New evidence on the relationship between risk attitudes and self-employment (2014)
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