NDLI: Entry regulation and entrepreneurship: a natural experiment in German craftsmanship

Content Provider	Springer Nature Link
Author	Rostam Afschar, Davud
Copyright Year	2013
Abstract	This paper uses the 2004 amendment to the German Trade and Crafts Code as a natural experiment for assessing the causal effects of this reform on the probabilities of being self-employed and of transition into and out of self-employment. This is achieved by using repeated cross-sections (2002–2009) of German microcensus data. I apply the difference-in-differences technique for three groups of craftsmen which were subject to different intensities of treatment. The results show that the complete exemption from the educational entry requirement has fostered self-employment significantly by substantially increasing the entry probabilities, while exit rates have remained unaffected. I find similar, though weaker relative effects for the treatment groups that were subject to a reduction of entry costs or a partial exemption from the entry requirements. Moreover, I consider effect heterogeneity within each of the treatment groups with respect to gender and vocational training, and show that the deregulation of entry requirements has been most effective for untrained workers.
Starting Page	1067
Ending Page	1101
Page Count	35
File Format	PDF
ISSN	03777332
Journal	Empirical Economics
Volume Number	47
Issue Number	3
e-ISSN	14358921
Language	English
Publisher	Springer Berlin Heidelberg
Publisher Date	2013-12-08
Publisher Place	Berlin, Heidelberg
Access Restriction	One Nation One Subscription (ONOS)
Subject Keyword	Entrepreneurship Regulation Firm entry Natural experiment Craftsmanship Econometrics Statistics for Business/Economics/Mathematical Finance/Insurance Economic Theory
Content Type	Text
Resource Type	Article
Subject	Statistics and Probability Social Sciences Economics and Econometrics

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