Choice of Becoming Self-Employed in Belarus: Impact of Monetary Gains

Development of self-employment becomes increasingly important issue for the transitional economy of Belarus. However the role of pecuniary benefits in terms of moving people towards selfemployment is not explored, and neither is the question of whether the direction of its’ impact is different for men and women in Belarus. The paper investigates that question using 2006-2010 Belarusian Household Survey on Incomes and Expenditures and is based on the multinomial logit choice model. To get selectivity corrected predicted earnings the methodology proposed by Bourguignon et al. (2007) is applied. The obtained results show that higher expected earnings attract women to turn into entrepreneurship compared with paid-employment while pecuniary benefits do not have significant effect on choice of men. Education, age and risk factor appear to be important influencing factors in terms of choice depending on the gender of an entrepreneur.