Small Business Economics

, Volume 30, Issue 4, pp 423–437 | Cite as

Intergenerational correlation in self employment: some further evidence from French ECHP data

Article

Abstract

Previous empirical work has shown that self-employment is correlated across generations, so that the children of the self-employed are themselves more likely to be self-employed. However, the reason for this intergenerational correlation remains unclear. This paper contributes to the existing literature in two ways. First, using French data from the European Community Household Panel Survey, we provide a further examination of this intergenerational correlation among the self-employed. In particular we investigate to what extent the intergenerational correlation in self-employment reflects occupational following. The second contribution of our paper is to investigate the differences between first- and second-generation self-employed workers and their possible explanations. Even though our results indicate that having self-employed parents increases the probability of being self-employed, irrespective of occupation, we do observe that a large majority of individuals enter the same (or very similar) occupation as their parents, which is consistent with occupational following. Our results also reveal some differences between the first- and second-generation self-employed. Formal education is more important for the first-generation self-employed (those whose parents are not self-employed) than for the second-generation self-employed. Further, the first-generation self-employed, who received less informal human capital than the second-generation self-employed, compensate for this shortcoming by acquiring more formal education.

Keywords

Self-employment Intergenerational Correlation Social Environment Human Capital 

JEL Classifications

J20 J21 J23 J24 L26 

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Copyright information

© Springer Science+Business Media, LLC 2007

Authors and Affiliations

  1. 1.CNRS, CREMRennesFrance
  2. 2.CIRANOMontrealCanada

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