Income determinants and factors affecting the choice of self-employed Canadians to invest in RRSPs and health-related benefits: An empirical analysis and policy reflection

Self-employment in Canada has risen dramatically over the past three decades, accounting for a disproportionate share ofjobs created in the early 1990s. The macroeconomic gains from selfemployment have inspired much research, with numerous studies examining driving Forces behind the engagement in entrepreneurship. A very few studies have examined entrepreneurs' socio-economic security. Using microdata files from the Survey of Self-Employment, 2000, this study employs a series of binomial logistic regressions to examine earnings determinants and factors influencing the likelihood of self-employed Canadians to own Registered Retirement Savings Plans (RRSPs) and health-related benefits coverage. Two policy-related issues surfaced: (I) the vulnerable segments include women, own-account entrepreneurs, involuntarily selfemployed, low-tenure entrepreneurs, and self-employed with dependent children; (2) income, wealth, savings behaviour, and membership in associations are significant factors that resurface repeatedly in benefits models. Combined with previous research, these findings have inspired several policy options, discussed at the end of this report.