Entry into and Exit from Self-Employment in Japan

Data from the 1995 Social Stratification and Social Mobility National Survey are used to investigate the determinants of entry into and exit from self-employment in Japan. First, the socio-legal context of self-employment in Japan is described, and relevant self-employment literature is reviewed.The data, which are based on the work histories of 2,653 survey respondents, are described and analyzed.Findings suggest that educational attainment does not increase the likelihood of entering self-employment. Indeed, there is a negative association between educational attainment and the chances of entry into skilled self-employment.Work experience in very small firms employing thirty or fewer people, on the other hand, is positively associated with entry into professional and skilled self-employment. Finally, individuals with self-employed fathers are more likely to enter and to thrive in self-employment.The direct inheritance of a family business is particularly likely to result in successful self-employment.Taken together, the findings suggest that Japanese self-employment is characterized by unique features.Unlike other countries, Japan did not experience growth in the self-employment sector in the 1980s and 1990s.Also unusual is the fact that traditional skilled self-employment continues to dominate the sector. (SAA)