Entrepreneurs and Workers

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IZA Seminar

Place: Schaumburg-Lippe-Str. 9, 53113 Bonn

Date: 10.02.2004, 12:15 - 13:30


Presentation by 

Panu Poutvaara (University of Munich)


Using an extensive panel of 350,000 individuals over 12 years, we estimate earnings functions for workers and entrepreneurs in Finland. When controlling for the level of education, entrepreneurs usually have lower median income but higher average income. Earnings equations explain a considerably smaller share of variation of income for entrepreneurs. Surprisingly, entrepreneurs with high school or vocational education earn less than entrepreneurs with only basic education or less, while average earnings for workers increase in the level of education. We conclude with tentative policy implications concerning education policy and entrepreneurship.

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