|Title||The Relationship between Self-employment and Unemployment in the Long-Run: A Panel Cointegration Approach Allowing For Breaks|
|Authors||Saridakis, G., Mendoza, M.A., Muñoz Torres, R.I. and Glover, J.|
Although a lot of research has been done on the link between self-employment and unemployment, often focusing on the short-run of the relationship, the long-run association between the two variables has not received adequate attention. In this paper we examine the long-run relationship between self-employment and unemployment using panel cointegration methods allowing for structural breaks and covering a wide range of European OECD countries using the COMPENDIA dataset over the period 1990-2011. Our findings indicate that a long-run relationship between self-employment and unemployment exist in the panel, but the cointegrating coefficients are unstable. Our estimates finds that positive and statistically significant long-run association between self-employment and unemployment exists for more than 50% of the countries included in the sample after the break. For the rest of the countries we find either negative or statistically insignificant association.
|Keywords||self-employment, unemployment, Europe, panel cointegration, long-run, structural breaks|
|Journal||Journal of Economic Studies|
|Journal citation||43 (3), pp. 358-379|
|Digital Object Identifier (DOI)||doi:10.1108/JES-11-2013-0169|
|Published||03 Aug 2016|