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Job satisfaction and self-employment: autonomy or personality?

Abstract

Most studies in the economics discourse argue that the impact of self-employment on job satisfaction is mediated by greater procedural freedom and autonomy. Values and personality traits are considered less likely to explain the utility difference between self-employed and salaried workers. Psychology scholars suggest that entrepreneurial satisfaction also depends, at least in part, on specific values and personality traits. Utilising a large dataset derived from the 2006 European Social Survey, this study performs a complementary analysis by taking personality traits, personal values and indicators for workers’ autonomy explicitly into account. The empirical findings add further strength to economists’ argument that, net of values and personality traits, autonomy and independence are the mechanisms by which self-employment leads to higher levels of job satisfaction. These results hold true for both male and female sub-samples even when a multitude of socio-demographic characteristics, personal values and personality traits are controlled for.

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Notes

  1. In the spirit of Blanchflower and Oswald’s observation that “the simplest kind of entrepreneurship is self-employment” (Blanchflower and Oswald 1998, p. 27), the terms ‘entrepreneur’ and ‘self-employed’ are used interchangeably throughout the analysis.

  2. Data from the 2006 European Social Survey were released in April 2008. For a description of the sampling design, see Lynn et al. (2004). For further information, including questionnaire design details see www.europeansocialsurvey.org.

  3. In Schumpeter’s view, the entrepreneur does not passively operate. Instead, he creates an environment different from the one hitherto encountered by seeing through investments of physical, emotional and intellectual assets. In Schumpeter’s own words: “… there is the joy of creating, of getting things done, or simply of exercising one’s energy and ingenuity” (Schumpeter 1934, p. 93).

  4. It is interesting to note that these characteristics are broadly consistent with the concept of ‘core self-evaluations’, which is manifested in self-esteem, locus of control, generalised self-efficacy and low levels of neuroticism. These personality traits have been shown to serve as significant predictors of job satisfaction (Judge et al. 1998).

  5. Defined as respondents being in 30 h or more of paid employment per week for their main job.

  6. The employment status variable adopts the employment classifications specified in the ESS, without making any additional adjustments to the self-employment category. On this basis and across the chosen countries, an average of 8.1% of the workforce sampled was self-employed. This is broadly in line with the observation by Benz and Frey (2008a, p. 362) who note that “around 10% of all individuals gainfully employed in Western countries are self-employed”.

  7. For a notable exception, see the analysis on values and personality characteristics of the self-employed by Beugelsdijk and Noorderhaven (2005).

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Acknowledgements

I would like to express my gratitude to two anonymous reviewers whose comments and suggestions helped improve an earlier draft of this paper in many important ways. I am also indebted to Andrew Clark, Yannis Georgellis, Scott Fargher and Gail Pacheco for their instructive comments on earlier drafts. The usual disclaimer applies.

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Correspondence to Thomas Lange.

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Lange, T. Job satisfaction and self-employment: autonomy or personality?. Small Bus Econ 38, 165–177 (2012). https://doi.org/10.1007/s11187-009-9249-8

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Keywords

  • Job satisfaction
  • Self-employment
  • Personality traits
  • Autonomy
  • European social survey

JEL Classifications

  • J28
  • L26