The Heterogeneous Impact of Unemployment Insurance on the Activity of Urban Entrepreneurship: Also on the Road of High-quality Entrepreneurship in China
The Heterogeneous Impact of Unemployment Insurance on the Activity of Urban Entrepreneurship: Also on the Road of High-quality Entrepreneurship in China
FAN Hongzhong, ZOU Nan
School of of Economics, Huazhong University of Science and Technology, Wuhan 430074, China
Abstract Based on the information of urban industrial and commercial registered enterprises and unemployment insurance premium data in China from 2008 to 2021, this paper analyzes the impact of unemployment insurance premium on entrepreneurial activity in different types of cities. The study has found that unemployment insurance benefits have a positive impact on the activity of opportunity based entrepreneurship and a negative impact on the activity of survival based entrepreneurship. Mechanism testing shows that unemployment insurance benefits have both the occupational choice effect of suppressing entrepreneurship by reducing unemployment costs and the market potential effect of promoting entrepreneurship by increasing labor market supply. These two effects respectively reveal the channels through which unemployment insurance benefits affect the activity of survival oriented entrepreneurship and opportunity oriented entrepreneurship. Furthermore, unemployment insurance benefits have improved the quality of entrepreneurship. Heterogeneous analysis at the city level indicates that in places with higher urban capital endowments and human capital endowments, unemployment insurance benefits have a more obvious impact on opportunistic entrepreneurial activity, while survival entrepreneurial activity is the opposite. Heterogeneous analysis at the industry level shows that unemployment insurance benefits mainly affect the activity of opportunistic entrepreneurship in labor-intensive industries. Micro-level heterogeneity analysis indicates that unemployment insurance benefits have a stronger inhibitory effect on the entrepreneurial choices of individuals with unemployment insurance. The conclusions provide policy insights for recognizing the economic effects of China's unemployment insurance system and promoting entrepreneurship and high-quality economic development at the level of social security.
FAN Hongzhong,ZOU Nan. The Heterogeneous Impact of Unemployment Insurance on the Activity of Urban Entrepreneurship: Also on the Road of High-quality Entrepreneurship in China. Economic Survey, 2025, 42(1): 03.
2025, Vol. 42 
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