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Who benefits from labor market institutions? Evidence from surveys of life satisfaction

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Author Info

  • Ochsen, Carsten
  • Welsch, Heinz

Abstract

This paper investigates the welfare effects of labor market institutions, placing an emphasis on how the institutions’ effects are differentiated by socio-demographic subgroups. We study how life satisfaction is affected by employment protection and the level and duration of unemployment benefit payments. Using data for almost 370,000 individuals in ten European countries, 1975–2002, we find that more employment protection and a higher benefit replacement rate increase the life satisfaction of the average citizen. At the subgroup level, different segments of the population are affected differently by the two categories of labor market institutions. While employment protection is valued especially by employed persons of intermediate age, it is less beneficial for women/housewives and for older persons. More generous unemployment insurance is valued especially by these latter subgroups and by the unemployed.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Economic Psychology.

Volume (Year): 33 (2012)
Issue (Month): 1 ()
Pages: 112-124

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Handle: RePEc:eee:joepsy:v:33:y:2012:i:1:p:112-124

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Web page: http://www.elsevier.com/locate/joep

Related research

Keywords: Employment protection; Unemployment benefit; Macroeconomic uncertainty; Life satisfaction; Happiness;

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Cited by:
  1. Adrian Chadi & Clemens Hetschko, 2013. "Flexibilisation without Hesitation? Temporary Contracts and Workers’ Satisfaction," IAAEU Discussion Papers 201304, Institute of Labour Law and Industrial Relations in the European Union (IAAEU).
  2. Romina Boarini & Margherita Comola & Femke Keulenaer & Robert Manchin & Conal Smith, 2013. "Can Governments Boost People’s Sense of Well-Being? The Impact of Selected Labour Market and Health Policies on Life Satisfaction," Social Indicators Research, Springer, vol. 114(1), pages 105-120, October.

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