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The Self-Employment Gap Between Immigrants and Natives in Europe: Dynamics and Drivers

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Parent Category: 2026

Category: Content №1 2026

Created on 27 February 2026

Last Updated on 27 February 2026

Published on 30 November -0001

Written by O. Liashenko, O. Dluhopolskyi, V. Volkova, N. Volkova

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Authors:

O. Liashenko, orcid.org/0000-0001-5489-815X, Loughborough University, Loughborough, the United Kingdom of Great Britain and Northern Ireland; Lesya Ukrainka Volyn National University, Lutsk, Ukraine,  e-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

O. Dluhopolskyi*, orcid.org/0000-0002-2040-8762, West Ukrainian National University, Ternopil, Ukraine; WSEI University, Lublin, Republic of Poland, e-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

V. Volkova, orcid.org/0000-0003-1539-6194, Vasyl Stus Donetsk National University, Vinnytsia, Ukraine, e-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

N. Volkova, orcid.org/0000-0003-3790-3636, Vasyl Stus Donetsk National University, Vinnytsia, Ukraine, e-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

* Corresponding author e-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

повний текст / full article

Naukovyi Visnyk Natsionalnoho Hirnychoho Universytetu. 2026, (1): 238 - 248

https://doi.org/10.33271/nvngu/2026-1/238

Abstract:

Purpose. This study aims to investigate how macroeconomic conditions, migrant composition, integration policies, and welfare state institutions influence the self-employment gap between migrant and native-born populations, with particular attention to the roles of unemployment, economic growth, non-EU migrant shares, integration policy quality (MIPEX), and social spending.

Methodology. The study investigates the self-employment gap between foreign-born and native-born populations across 36 European countries from 1995 to 2024, utilising an unbalanced panel of 780 country-year observations from the Eurostat Labour Force Survey. The study applies panel data econometric modelling and quantitative statistical methods to identify and estimate the determinants of the self-employment gap between foreign-born and native-born populations across European countries.

Findings. The gap, defined as the difference in self-employment rates (foreign-born minus native-born), averages 1.07 percentage points, indicating a modest immigrant disadvantage, yet exhibits substantial heterogeneity and temporal convergence towards parity (+0.091 pp annually). Two-way fixed-effects regressions reveal that higher unemployment widens positive gaps. In contrast, GDP growth, inclusive MIPEX policies, and social expenditure attenuate them. Compositional effects drive positive differentials in New EU member states (+1.29 pp) relative to EU‑15 nations (2.25 pp). The gap demonstrates remarkable persistence ( = 0.940; half-life 11 years), with between-country variance predominating (80 %). The 2008 crisis marks a structural shift (p = 0.055), whereas COVID-19 yields no significant impact (p = 0.705).

Originality. The originality of research lies in integrating necessity-driven entrepreneurship, economic cycle effects, compositional migrant structures, integration policy effectiveness (MIPEX), and welfare state generosity within a single dynamic framework. By estimating gap persistence and half-life, the study introduces a novel contribution to the literature, demonstrating how structural shocks generate long-lasting effects.

Practical value. Findings underscore institutional divergences as pivotal determinants, advocating for harmonised integration reforms to harness migrant entrepreneurship for inclusive growth.

Keywords: self-employment gap, immigrant entrepreneurship, migrant integration, European Union, MIPEX, welfare state

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