International Business & Economics Research Journal – Special Issue 2014 Volume 13, Number 8 Copyright by author(s); CC-BY 1635 The Clute Institute The Decision To Set Up Home Independently In Spain: Explanatory Factors Guillermo Ceballos-Santamaría, Castilla-La ManchaUniversity, Spain Juan José Villanueva Álvaro, Castilla-La ManchaUniversity, Spain ABSTRACT Young people today are leaving the parental home; i.e., living independently at increasingly later ages. In Mediterranean Europe in particular, most males, and a large portion of females, continue to live in their parents’ home until they are into their thirties. In the case of Spain, in recent years, a series of economic and social changes have led to a rise in young people’s uptake of non-compulsory stages of education, resulting in increasingly late arrival on the job market (with this extended education and also high youth unemployment), characterized by higher temporary employment rates and greater vulnerability in the process of joining the labor force than previous cohorts. As regards to living independently, despite a very large increase in housing stock over the past ten years, young Spaniards encounter increasing difficulties in gaining access to housing because of higher purchase prices and the structure of the rental market. This paper will study the socioeconomic factors that have influenced the young Spanish population when deciding to leave the family home (i.e., becoming autonomous). Keywords: Young People; Independence; Leaving The Parental Home; Housing INTRODUCTION oung people’s leaving the parental home at later ages has a series of notable social and economic consequences. Setting up a new home is an economic decision in that it involves the emergence of new consumer centers and new decision-making units in the spheres of employment, consumption and investment. Young people need to consider whether the disutility of living with their parents (given the lack of autonomy and independence) is offset by the utility of the income and consumer goods that parents make available to their offspring when living together. Independent living is therefore a decision with costs (setting-up and housing) and benefits (freedom, autonomy, forming one’s own home). An empirical analysis of the decision to leave home will take account of various personal characteristics and of the young person’s environment (yout h labor market and housing market in the area lived in) and of the psychological cost of living with one’s parents (considering indicators of the relative permissiveness of the young respondent’s parents and ideological differences between parents and offspring). Two major changes that occur in the transition from adolescence to young adulthood are forming one’s own independent home and joiningthe labor force (Colom Andrés et al., 2003). Regarding this demographic trend, there is empirical evidence for Spain from the 90s. For example, Fernández Cordon (1997) shows with Eurostat data that in 1994, 64.8% of Spanish males aged 25-29 and 47.6% of females in the same age group continued to live with their parents due to the longer duration of education and the poorer conditions in which young people joined the labor force (higher unemployment rates than for older adults, increasing flexibility and insecurity in employment). Y