Testing the "residential rootedness" hypothesis of self-employment for Germany and the UK

Reuschke, Darja and van Ham, Maarten (2013) Testing the "residential rootedness" hypothesis of self-employment for Germany and the UK. Environment and Planning A, 45 (5), 1219-1239. (doi:10.1068/a45288).

Abstract

Based on the notion that entrepreneurship is a ‘local event’, the literature argues that entrepreneurs are ‘rooted’ in place. This paper tests the ‘residential rootedness’ hypothesis of self-employment by examining for Germany and the UK whether the self-employed are less likely to move over long distances (internal migration) than workers in paid employment. Using longitudinal data from the German Socio-Economic Panel Study (SOEP) and the British Household Panel Survey (BHPS), and accounting for transitions in employment status we found little evidence that the self-employed in Germany and the UK are more rooted in place than workers in paid employment. Generally speaking, the self-employed were no less likely than workers in paid employment to migrate over longer distance. In contrast to the residential rootedness hypothesis we found that entry into self-employment and female self-employment are associated with internal migration, and that the self-employed who work from home (home-based businesses) are fairly geographically mobile. The gendered results suggest that women might use self-employment as a strategy to be spatially mobile with their household, or as a strategy to stay in the workforce after having moved residence until they find a job in the more secure wage and salary sector.

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Contributors

Author: Darja Reuschke

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