Note: We are grateful for financing from the Ruben Rausing Fund for Research on New Enterprise and Innovation. We also wish to thank two anonymous referees and seminar participants in Uppsala, Umeå and Örebro, as well as at SOFI, FIEF, IUI, and the Swedish Ministry of Finance for useful comments and suggestions.
SELF-EMPLOYMENT AND WEALTH INEQUALITY
Version of Record online: 8 MAR 2005
Review of Income and Wealth
Volume 44, Issue 1, pages 25–41, March 1998
How to Cite
Lindh, T. and Ohlsson, H. (1998), SELF-EMPLOYMENT AND WEALTH INEQUALITY. Review of Income and Wealth, 44: 25–41. doi: 10.1111/j.1475-4991.1998.tb00250.x
- Issue online: 8 MAR 2005
- Version of Record online: 8 MAR 2005
Is the decision to become and stay self-employed constrained by access to credit? If this is the case, a more unequal wealth distribution will—for empirically observed distributions–imply more self-employed, since the number of people able to provide collateral will be higher. Swedish data between 1920 and 1992 suggest that wealth inequality and the share of self-employed among those working are positively related. The data, therefore, are consistent with the hypothesis that liquidity constraints are binding on the decision to become and stay self-employed.