Self-employment duration in urban and rural locations

Mika Haapanen (1) , Hannu Tervo (1)

1 School of Business and Economics [Jyväskylä]

Previous research has shown that the local environment is important for self-employment. The dynamics of self-employment varies between areas characterized by different labour market conditions, entrepreneurial traditions and other structural factors. This paper analyzes self-employment spells in Finland with a large register-based data set from the period 1987-2002. The main aim is to investigate the role of region-specific factors as compared with individual-specific and other factors on the duration of self-employment spells. First, the descriptive analysis shows that the exit rates from self-employment and the length of self-employment spells depend upon location (urban vs. rural area) and the cyclical trends in the economy. Second, self-employment duration is modelled using discrete time survival analysis. It is found that rural areas have significantly lower exit rates in the first years of self-employment than urban areas.

Mots clés: Social Sciences & Humanities

Mika Haapanen, Hannu Tervo. Self-employment duration in urban and rural locations. Applied Economics, 2009, 41 (19), pp.2449-2461. ⟨10.1080/00036840802360278⟩. ⟨hal-00582212⟩