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The Effect of Unemployment on the Mental Health of Spouses: Evidence from Plant Closures in Germany

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  • Jan Marcus

Abstract

Studies on health effects of unemployment usually neglect spillover effects on spouses. This study specifically investigates the effect of an individual's unemployment on the mental health of their spouse. In order to allow for causal interpretation of the estimates, it focuses on an exogenous entry into unemployment (i.e. plant closure), and combines difference-in-difference and matching based on entropy balancing to provide robustness against observable and time-invariant unobservable heterogeneity. Using German Socio-Economic Panel Study data the paper reveals that unemployment decreases the mental health of spouses almost as much as for the directly affected individuals. The findings highlight that previous studies underestimate the public health costs of unemployment as they do not account for the potential consequences for spouses.

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File URL: http://www.diw.de/documents/publikationen/73/diw_01.c.409023.de/diw_sp0488.pdf
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Bibliographic Info

Paper provided by DIW Berlin, The German Socio-Economic Panel (SOEP) in its series SOEPpapers on Multidisciplinary Panel Data Research with number 488.

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Length: 25 p.
Date of creation: 2012
Date of revision:
Publication status: Published in: Journal of Health Economics 32 (2013), 3, 546-558
Handle: RePEc:diw:diwsop:diw_sp488

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Keywords: Unemployment; mental health; plant closure; entropy balancing; matching; job loss;

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References

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  1. Eliason, Marcus & Storrie, Donald, 2004. "Does job loss shorten life?," Working Papers in Economics 153, University of Gothenburg, Department of Economics, revised 17 Sep 2007.
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  21. Andreas Knabe & Steffen Rätzel, 2008. "Scarring or Scaring? The Psychological Impact of Past Unemployment and Future Unemployment Risk," CESifo Working Paper Series 2457, CESifo Group Munich.
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Citations

Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. How much do spouses suffer from unemployment?
    by Economic Logician in Economic Logic on 2012-11-05 15:10:00
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
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Cited by:
  1. Nádia Simões & Nuno Crespo & Sandrina B. Moreira & Celeste A. Varum, 2013. "Measurement and Determinants of Health Poverty and Richness – Evidence from Portugal," Working Papers Series 2 13-08, ISCTE-IUL, Business Research Unit (BRU-IUL).
  2. Hendrik Schmitz & Matthias Westphal, 2013. "Short- and Medium-term Effects of Informal Care Provision on Health," Ruhr Economic Papers 0426, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
  3. André Hajek, 2013. "Life Satisfaction and Unemployment: The Role of Voluntariness and Job Prospects," SOEPpapers on Multidisciplinary Panel Data Research 601, DIW Berlin, The German Socio-Economic Panel (SOEP).

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