Self-employment and Mental Health

In a response to the increasing prevalence of individuals suffering from mental illness, this study investigates the relationship between self-employment and mental health using the MIDUS II study on health and well-being from the United States. In addition, the paper provides an insight in the underlying mechanisms of this relation by analyzing the moderation effects of social support and self-efficacy and the mediation effect of stress. Estimation results confirm the expectation of better self-evaluated mental health for the self-employed compared to wage workers but show no significant difference in depressive symptoms between the two occupational groups. Social support and self-efficacy do not have a significant role as mediator. Nevertheless, given the evidence for an association between self-employment and mental health, the findings suggest that stimulation of self-employment and more entrepreneurial work characteristics within corporate environments are instrumental in enhancing mental health.