Are the Educated Interested in Self-Employment? A Case Study in Indonesia

Abstract

Education is one of the form of human capital investment, it could lead to a productive labour. Educated labour are having a much more diverse job option, which making self-employment interesting for those who are not well educated. Self-employment itself could be interesting for both educated and uneducated people alike. However, due to its risky nature, people are having tendency to pick a stable job. On the other hand, the chance for achieving a success business is high for educated people. Considering its risky nature and the success chance, do educated people are interested to entering self-employment? Using probit regression, this study is trying to find the effect of education degree to the decision of entering self-employment in case of Indonesian. This pooled cross-section research utilize IFLS dataset observing working people age 23 to 25 years old. The result shows that people with higher education level are less likely to becoming self-employed.