The dynamics of combining self-employment and employment

This study examines the extent to which wage-earning workers are simultaneously self-employed, a phenomenon not thoroughly investigated in earlier studies. We use matched employee-employer databases to present a detailed investigation of self-employment patterns within the post industrial sectors in Sweden from 1990 to 2002. We find that persons that combine self-employment with waged work constitute a majority of the total number of self-employed, and that most people enter self-employ­ment by engaging first in combinatory work, indicating that the decision to move to self-employment is more complex than characterized in earlier research.

Keywords: Self-employment, income dynamics, entrepreneurship
JEL-codes: J24, J60