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      Emergency-aid for self-employed in the Covid-19 pandemic: A flash in the pan?

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          Abstract

          The self-employed faced strong income losses during the Covid-19 pandemic. Many governments introduced programs to financially support the self-employed during the pandemic, including Germany. The German Ministry for Economic Affairs announced a €50bn emergency-aid program in March 2020, offering one-off lump-sum payments of up to €15,000 to those facing substantial revenue declines. By reassuring the self-employed that the government ‘would not let them down’ during the crisis, the program had also the important aim of motivating the self-employed to get through the crisis. We investigate whether the program affected the confidence of the self-employed to survive the crisis using real-time online-survey data comprising more than 20,000 observations. We employ propensity score matching, making use of a rich set of variables that influence the subjective survival probability as main outcome measure. We observe that this program had significant effects, with the subjective survival probability of the self-employed being moderately increased. We reveal important effect heterogeneities with respect to education, industries, and speed of payment. Notably, positive effects only occur among those self-employed whose application was processed quickly. This suggests stress-induced waiting costs due to the uncertainty associated with the administrative processing and the overall pandemic situation. Our findings have policy implications for the design of support programs, while also contributing to the literature on the instruments and effects of entrepreneurship policy interventions in crisis situations.

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          Estimating causal effects of treatments in randomized and nonrandomized studies.

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            INDIVIDUAL RISK ATTITUDES: MEASUREMENT, DETERMINANTS, AND BEHAVIORAL CONSEQUENCES

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                Author and article information

                Journal
                J Econ Psychol
                J Econ Psychol
                Journal of Economic Psychology
                Elsevier B.V.
                0167-4870
                0167-4870
                23 September 2022
                December 2022
                23 September 2022
                : 93
                : 102567
                Affiliations
                [a ]Trier-University, Germany
                [b ]Erasmus-University Rotterdam, The Netherlands
                [c ]Wittener Institut für Familienunternehmen (WIFU), University Witten/Herdecke, Germany
                [d ]German Institute for Economic Research (DIW-Berlin), Potsdam University, IZA, Bonn and IAB, Nuremberg, Germany
                [e ]DIW Econ GmbH, Berlin, Germany
                [f ]DIW-Berlin, Berlin, Germany
                Author notes
                [* ]Corresponding author at: DIW Berlin, Mohrenstr. 58, 10117 Berlin, Germany.
                Article
                S0167-4870(22)00078-2 102567
                10.1016/j.joep.2022.102567
                9547119
                b2a8c1ae-f3aa-4260-ab7f-74fd2805a75c
                © 2022 Elsevier B.V. All rights reserved.

                Since January 2020 Elsevier has created a COVID-19 resource centre with free information in English and Mandarin on the novel coronavirus COVID-19. The COVID-19 resource centre is hosted on Elsevier Connect, the company's public news and information website. Elsevier hereby grants permission to make all its COVID-19-related research that is available on the COVID-19 resource centre - including this research content - immediately available in PubMed Central and other publicly funded repositories, such as the WHO COVID database with rights for unrestricted research re-use and analyses in any form or by any means with acknowledgement of the original source. These permissions are granted for free by Elsevier for as long as the COVID-19 resource centre remains active.

                History
                : 8 November 2021
                : 19 September 2022
                : 19 September 2022
                Categories
                Article

                self-employment,emergency-aid,treatment effects,covid-19, entrepreneurship policy,subjective survival probability

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