Authors
Summary
Purpose: This study investigates the role of earnings in the relationship between age and self-employment decisions, which has remained unclear. By bringing together two areas of the self-employment literature, this research demonstrates how self-employment entry occurs differently across age, where the effect of prior employment pay is not consistent. Design/methodology/approach: Data from the UK Household Longitudinal Study 2009 to 2020 is used to examine how an individual's prior pay from employment impacts their propensity to enter self-employment through logistical regression methods. Findings: Our results suggest that older individuals with higher prior employment pay levels have an increased likelihood of becoming self-employed. By contrast, young individuals are more likely to become self-employed from lower-paid employment. Research limitations/implications: Our findings unlock key insights for future research, as we discover that an individual's decision to enter self-employment is influenced by their age in conjunction with their prior earnings from employment. Practical implications: The results suggest that financial aid directed to younger individuals may increase self-employment rates, whereas other assistance, such as training courses and network development, is likely to be a more effective policy strategy for older individuals. Originality/value: This study bridges two distinct strands in the current literature on self-employment by analysing how both an individual's age and earning capacity determine their likelihood of transitioning from paid employment to self-employment. This offers a new perspective, as these aspects have not been considered in tandem before.
Volume and page numbers
Volume: 33 , p.89 -111
Subjects
Notes
Open Access
© Benjamin Bolger, Frank Crowley, Justin Doran, Nóirín McCarthy and Bernadette Power.
Published by Emerald Publishing Limited.
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