Self-Employment and Fertility Intentions in Europe

Berkay Ozcan, London School of Economics
Antonella Bancalari, London School of Economics and Political Science

The relationship between self-employment and fertility is not well understood. Macro-level studies analyzing cross-country self–employment rates and fertility rates showed a negative association between the two aggregates in advance economies. Individual-level analyses suggested often positive association between being self-employed and fertility outcomes. We suggest that part of the inconsistency is due to the heterogeneity of the “self-employed”. We analyze the relationship between three different types of self-employment (i.e. Entrepreneur, Laborer and Professional) and fertility intentions of individuals using individual level data from the European Social Survey (ESS) covering more than 20 European countries. We use multilevel models that incorporate country-specific factors as well as individual level controls to bridge the gap between macro and micro level analyses. We run separate analyses for men and women and by parity (i.e. intentions for the first child versus for subsequent children). We find that men who are entrepreneur and laborer type of self-employed have higher likelihood of reporting positive intentions to become a father than wage earners. Only laborer type of self-employed women have higher likelihood of reporting positive intentions compared to employee women. Self-employment type is not associated with subsequent birth and our associations are robust to various controls at the country and individual levels and fixed effects. We provide additional analyses to test various mechanisms related to flexibility and resources using measures of relative earnings and relative hours of work of each partner.

Presented in Session 1160: Fertility