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“Fine... I’ll do it myself”: Lessons from self-employment grants in a long recession period

Ivan Zilic   ORCID icon orcid.org/0000-0002-1660-2124 ; The Institute of Economics, Zagreb
Stjepan Srhoj   ORCID icon orcid.org/0000-0002-7105-8088 ; University of Dubrovnik

Fulltext: english, pdf (1 MB) pages 2-38 downloads: 325* cite
APA 6th Edition
Zilic, I. & Srhoj, S. (2020). “Fine... I’ll do it myself”: Lessons from self-employment grants in a long recession period. Radni materijali EIZ-a, (1), 2-38. Retrieved from https://hrcak.srce.hr/232616
MLA 8th Edition
Zilic, Ivan and Stjepan Srhoj. "“Fine... I’ll do it myself”: Lessons from self-employment grants in a long recession period." Radni materijali EIZ-a, vol. , no. 1, 2020, pp. 2-38. https://hrcak.srce.hr/232616. Accessed 1 Aug. 2021.
Chicago 17th Edition
Zilic, Ivan and Stjepan Srhoj. "“Fine... I’ll do it myself”: Lessons from self-employment grants in a long recession period." Radni materijali EIZ-a , no. 1 (2020): 2-38. https://hrcak.srce.hr/232616
Harvard
Zilic, I., and Srhoj, S. (2020). '“Fine... I’ll do it myself”: Lessons from self-employment grants in a long recession period', Radni materijali EIZ-a, (1), pp. 2-38. Available at: https://hrcak.srce.hr/232616 (Accessed 01 August 2021)
Vancouver
Zilic I, Srhoj S. “Fine... I’ll do it myself”: Lessons from self-employment grants in a long recession period. Radni materijali EIZ-a [Internet]. 2020 [cited 2021 August 01];(1):2-38. Available from: https://hrcak.srce.hr/232616
IEEE
I. Zilic and S. Srhoj, "“Fine... I’ll do it myself”: Lessons from self-employment grants in a long recession period", Radni materijali EIZ-a, vol., no. 1, pp. 2-38, 2020. [Online]. Available: https://hrcak.srce.hr/232616. [Accessed: 01 August 2021]

Abstracts
This paper evaluates the effect of a self-employment grant scheme for unemployed individuals—designed to ease the first 12 months of business operation—on firm growth, survival, and labor market re-integration in Croatia in the 2010–2017 period. Grants offered a moderate amount of finances (up to 50% of average annual gross salary) and absorbed only 5% of funds allocated to active labor market policies, but accounted for 10% of new firms opened throughout the years. We use the universe of unemployment episodes and the universe of unlimited and limited liability firms to document the effect of self-employment grants both causally and descriptively. Exploiting longitudinal structure of unemployment episodes dataset, we find that individuals who finish their spell with a grant have a significantly lower probability of returning to unemployment. Also, we find that limited liability firms opened via a grant have lower growth potential and worse survival profile, while unlimited liability firms—even though a sizable portion of them closes after a required 12-month grant period—have a more favorable survival profile. While these results are in line with the rest of the empirical literature on the self-employment grants, we also find that the effectiveness of these grants has increased throughout the years, indicating towards the direction of institutional learning.

Keywords
self-employment grant; evaluation; unemployment; firm performance.

Hrčak ID: 232616

URI
https://hrcak.srce.hr/232616

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