The purpose of this paper is to investigate the gender impact of tertiary education on the probability of entering and remaining in self‐employment.
A data set on labour market flows produced by the Italian National Statistical Office is exploited by interviewing about 62,000 graduate and non‐graduate individuals in transition between five labour market states: dependent workers; self‐employed workers; unemployed persons; and non‐active persons. From these data, an average ten‐year transition matrix (1993‐2003) is constructed and the flows between labour market conditions by applying Markovian analysis are investigated.
The data show that education significantly increases the probability of entering self‐employment for both male and female graduates, but it also significantly increases the transition from self‐employment to dependent employment for female graduates, thereby increasing the percentage of female graduates in paid employment and reducing the percentage of women in entrepreneurial activities. It is argued that the disappointment provoked by the gender wage gap in paid employment may induce some female graduates with low‐entrepreneurial ability to set‐up on their own, but once in self‐employment they have lower survival rates than both men in self‐employment and women in paid employment. Thus, what is observed overall is that education widens the gender gap between self‐employed workers and employees for individuals persisting in the same working condition.
The data are enabled to shift the focus of the relationship between education and entrepreneurship from the probability of being self‐employed to the probability of entering and surviving in this condition.
