Exploiting a business opportunity or escaping unemployment? – The role of labour market career dynamics for entrepreneurial decisions.

This project combined two strands in the literature: the job search theory and the concept of necessity and opportunity driven entrepreneurs in order to examine the role of labour market career dynamics for decisions to become an entrepreneur. On the micro level it considered both the role of individual resources and opportunity costs in decisions to start up one’s own company. On the macro level the diversity of the regional labour markets was taken into account. We used unique quality longitudinal Swedish register data which combines information from different administrative sources about individual social background, education and labour market outcomes. We estimated hazard models of transition into entrepreneurship, where individual labour market status and income from economic activity were regarded as key determinants.

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The project was funded by a grant from the CERGE-EI (Center for Economic Research and Graduate Education – Economics Institute).