Labor Market Policies and Self-Employment Transitions of Older Workers

We study transitions in and out of self-employment of older individuals using internationally comparable survey data from 13 OECD countries. We examine the influence on self-employment transitions of several labor market policies and institutional factors, as well as individual characteristics like physical and mental health. Self-employment among older individuals is strongly affected by government policies: larger expenditures on employment incentives impact it positively, while the opposite is true for expenditures on early retirement and unemployment benefits.