Gender differences in self‐employment

Abstract

This paper examines the factors that influence transitions into self-employment, paying particular attention to gender differences. We find that: (i) men are more responsive to the wage differential between wage/salaried employment and self-employment; (ii) liquidity constraints are more important for men; and (iii) the link between father's self-employment status and the probability of self-employment is stronger for men. Taken together, these results suggest that, for women, self-employment is a closer substitute for part-time work and labour-market inactivity than it is for men. We attribute such differences to the different labour market opportunities and occupational strategies of women.