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Über dieses Buch

This book is the result of five years of research that I carried out as a research fellow at the Faculty of Economics and Econometrics of the University of Amsterdam. The project was initiated in 1986 by Frans van Winden and Roy Thurik. Frans van Winden became interested in self­ employment through his work concerning government behavior. In the models that he employs, the government is influenced by various social groups, the political strength of which is related to their size. As one of these is the group of self-employed individuals, he became interested in determinants of the size of this group. Roy Thurik was professionally interested in the subject because of his work at the Research Institute for Small and Medium-sized Business in the Netherlands (EIM), an institute that does much research in this area. Together, they wrote a proposal for a research project, for which they received funding from the Dutch Ministry of Economic Affairs . These funds were supplemented by the University of Amsterdam and at a later stage by the Organization for the Advancement of Research in the Economic Discipline (ECOZOEK), that is part of the Netherlands Organization for Scientific Research (NWO). This support is gratefully acknowiedged. The commercial edition of this book was partIy financed by the Centre for Energy Conservation and Environmental Technology (CE), the Center for Research in Experimental Economics and Political Decisionmaking (CREED), and the University of Amsterdam.

Inhaltsverzeichnis

Frontmatter

Chapter 1. Introduction

Abstract
In this chapter the subject of self-employment is introduced and an outline of the book is given. The chapter starts in Section 1.1 by indicating the relevance of the subject. Thereafter, in Section 1.2, attention is paid to the question what will be meant precisely by the group of self-employed individuals in this book. In Section 1.3 a global overview is given of determinants of self-employment put forward in the literature. Finally, in Section 1.4, we present an outline of the book.
Gerrit de Wit

Chapter 2. Models of self-employment in a competitive market

Abstract
In this chapter a survey is given of models in the literature that can be used to explain the number of self-employed individuals in the framework of a competitive market.1 Most of these models were actually developed for other goals. Some of the models discussed were developed to explain the number of firms, the size distribution of firms, or the number of entrepreneurs. Others were developed to explain other phenomena, for example the optimal tax rate, while making the number of self-employed individuals endogenous as an extra complication. For this reason this survey is more than a trivial enumeration of models present in the literature.
Gerrit de Wit

Chapter 3. An m-sector, n-group behavioral model of self-employment

Abstract
In this chapter a model is developed that determines the number of self-employed individuals in the framework of a competitive market.1 The model is meant as a unifying model in the following sense: (i) determinants that so far have been investigated separately in theoretical models are brought together in one model, and (ii) determinants that so far have not been modeled formally are now incorporated in a model.
Gerrit de Wit

Chapter 4. Intermezzo. Investigations of a certain class of linear complementarity problems

Abstract
This intermezzo deals with a class of linear complementarity problems (LCP’s) that emerged from the model developed in the previous chapter.1 Although the chapter is in this way linked to self-employment, its contents is purely mathematical. It is written in such a way that it can be understood independently from the contents of the other chapters.
Gerrit de Wit

Chapter 5. From the general-equilibrium model to a probabilistic-choice model

Abstract
In this chapter it is shown how the model developed in Chapter 3 can serve as a starting point for an empirical analysis. In particular, it is shown how the general-equilibrium model can be converted into a probabilistic-choice model that predicts the chance of individuals to become self-employed given their personal characteristics. Such a model can be estimated by using individual cross-section data. The actual estimation is done in Chapter 6.
Gerrit de Wit

Chapter 6. Two empirical applications

Abstract
In the previous chapter it was shown how the general-equilibrium model of Chapter 3 can be transformed into a probabilistic-choice model that (dependent on the assumptions made with respect to the error terms) may lead to a multinomial probit or logit model with estimable parameters. In this model individuals choose simultaneously their employment status (c.q. self-employment or wage-employment) and the sector in which they want to work. However, the size of the available data sets do not permit estimation of this comprehensive model. Therefore, we will simplify it to a univariate dichotomous (probit) model in which only the choice between self-employment and wage-employment is investigated. Thus, we arrive at a model consisting out of three equations: the equation describing the choice between self-employment and wage-employment and the earnings equations for the two different occupations. It is noted that such a model has become known in the literature as an endogenous switching model.
Gerrit de Wit

Chapter 7. Nomenklatura, state monopoly, and private enterprise

Abstract
So far attention has been focused on the determinants of self-employment in Western market economies. In this chapter we shift our attention to the centrally planned economies of Eastern Europe and the former Soviet republics.1 In particular, we investigate political economic conditions that may stimulate or inhibit a transition from a centrally planned economy to a market economy. These conditions can be seen as possible determinants of self-employment, as self-employment is only allowed in a market economy. In our analysis we use a general-equilibrium model of the kind presented in Chapters 2 and 3 of this book.
Gerrit de Wit

Chapter 8. Summary

Abstract
In this summary we give an overview of the main findings of this book. Simultaneously, the relevance of these findings with respect to the existing literature is pointed out.
Gerrit de Wit

Backmatter

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