HMN 2025: how parental insurance policies may have an effect on whether or not moms change into entrepreneurs

Research printed within the Journal of Management Studies gives new insights into how parental go away insurance policies, involving their money and time elements, may have an effect on whether or not moms begin a brand new enterprise.

Contrary to the widespread perception that beneficiant parental go away discourages entrepreneurship, the research finds that providing extra day off via parental go away can promote moms’ entrepreneurship.

In two complementary research, the researchers discovered that the period of parental go away—but not the sum of money paid—appears to form moms’ entrepreneurial exercise. The first study analyzed two main coverage reforms in Germany. A 2001 reform that shortened the period of parental go away diminished the percentages of moms changing into self-employed, whereas a 2007 reform that elevated the cash paid throughout parental go away had no vital impact.

The second study, wherein moms or soon-to-be moms rated the probability of changing into self-employed alongside numerous hypothetical eventualities that manipulated each the money and time elements of parental go away, offered additional assist that the period (however not the monetary assist) of parental go away considerably influences the perceived probability of changing into self-employed.

Additional analyses counsel that the cash part of parental go away nonetheless issues for some teams. Money impacts the probability of changing into an entrepreneur, notably amongst middle-class moms who’re closely burdened with family tasks.

“After childbirth, giving moms time to assume and replicate will enhance their probability of changing into self-employed,” stated first creator Pomme Theunissen, Ph.D., of Maastricht University.