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Banerjee, Tanima
- Occupational Choice in Developing Countries: Self-Employment versus Wage Employment - A Conceptual Framework
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1 Assistant Professor of Economics, School of Economics and Commerce, Adamas University, Barasat 700126, West Bengal, IN
1 Assistant Professor of Economics, School of Economics and Commerce, Adamas University, Barasat 700126, West Bengal, IN
Source
Artha Vijnana: Journal of The Gokhale Institute of Politics and Economics, Vol 63, No 4 (2021), Pagination: 333-359Abstract
In existing theories, richer people get higher loans, become entrepreneurs and earn high, people at the middle of wealth distribution choose self-employment, and people who join wage employment have the least income. However, in developing nations, regular wage employment offers higher income than self-employment, and to justify these findings, a partial equilibrium model is developed. Given lack of collateral, occupational choices are based on human capital possession and capital availability. In this model, in a skill-based dual sector economy, self-employment generates lower income than regular wage employment with discriminatory tastes of employers having an influence on occupational choices as well.Keywords
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