Self-employment in post-communist economies: A cross-country comparison, 1996-2005

According to the market transition theory the economic success of individuals in post-communist countries is affected by both individual characteristics and structural contexts. We investigate this claim using data on self-employment in four post-communist countries (Bulgaria, Russia, Estonia and Hungary) in 1996 and 2005. We find support for a relationship between context-characteristics and self-employment; especially countries with lower levels of corruption show higher odds of self-employment. Unexpectedly, as the transformation process proceeded, human capital did not become a more important predictor for self-employment.