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Family Ties And Unemployment

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Author Info

  • María Dolores Guilló

    ()
    (Universidad de Alicante)

  • Antonia Díaz

    (Universidad Carlos III de Madrid)

Abstract

In this paper we build a model economy in which the prevailing family structure arises endogenously as a response to labor market conditions. In this model the members of the household (parents and young adults) either work in the market, search for a job, or produce a household good. Parents feel altruistically towards their offspring. Our first finding is that search efforts of the unemployed members of the family are strategic substitutes. The second one is that, everything else equal, young adults leave their parents' house if they receive a sufficiently high wage; otherwise, they stay. In the latter case, both young adult's and spouse's search efforts are lower, since the spouse's opportunity cost of working in the market is greater when the employed young adult stays at home. As a result, both youth's and female spouse's unemployment rates are higher. This result is in line with the evidence we have for Spain.

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File URL: http://www.ivie.es/downloads/docs/wpasad/wpasad-2000-07.pdf
File Function: Fisrt version / Primera version, 2000
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Bibliographic Info

Paper provided by Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie) in its series Working Papers. Serie AD with number 2000-07.

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Length: 32 pages
Date of creation: Mar 2000
Date of revision:
Publication status: Published by Ivie
Handle: RePEc:ivi:wpasad:2000-07

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Related research

Keywords: Family Ties; Household Good; Unemployment.;

References

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  1. Samuel Bentolila & Andrea Ichino, 2000. "Unemployment and Consumption: Are Job Losses Less Painful near the Mediterranean?," CESifo Working Paper Series 372, CESifo Group Munich.
  2. Olga Cantó-Sánchez & Magda Mercader-Prats, . "Poverty among children and youth in Spain: The role of parents and youth employment status," Studies on the Spanish Economy 46, FEDEA.
  3. Namkee Ahn & Arantza Ugidos, 1996. "The effects of the labor market situation of parents on children: inheritance of unemployment," Investigaciones Economicas, Fundación SEPI, vol. 20(1), pages 23-41, January.
  4. Chiappori, P.A., 1989. "Collective Labour Supply and Welfare," DELTA Working Papers 89-07, DELTA (Ecole normale supérieure).
  5. Maite Martínez-Granado & Javier Ruiz-Castillo, 2002. "The decisions of Spanish youth: A cross-section study," Journal of Population Economics, Springer, vol. 15(2), pages 305-330.
  6. Chiappori, Pierre-André & Fortin, Bernard & Lacroix, Guy, 1998. "Household Labor Supply, Sharing Rule and the Marriage Market," Cahiers de recherche 9810, Université Laval - Département d'économique.
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Cited by:
  1. Paola Giuliano, 2005. "Living Arrangements in Western Europe: Does Cultural Origin Matter?," 2005 Meeting Papers 189, Society for Economic Dynamics.

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