NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Health Insurance and the Supply of Entrepreneurs

Douglas Holtz-Eakin, John R. Penrod, Harvey S. Rosen

NBER Working Paper No. 4880
Issued in October 1994
NBER Program(s):   HC   LS

Some commentators have suggested that the absence of portable health insurance impedes people from leaving their jobs to start new firms. We investigate this belief by comparing wage-earners who become self-employed during a given period of time with their counterparts who do not. By examining the impact of variables relating to the health insurance and health status of these workers and their families, we can infer whether the lack of health insurance portability affects the probability that they become self-employed. The evidence does not support the conjecture that the current health insurance system affects the propensity to become self-employed. Hence, whatever its other merits, there is no reason to believe that the introduction of universal health insurance would significantly enhance entrepreneurial activity.

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Document Object Identifier (DOI): 10.3386/w4880

Published: Journal of Public Economics, vol. 62, no. 1-2, pp. 209-235, (1996)

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