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Unemployment and social exclusion

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  • Pohlan, Laura

Abstract

This paper analyzes those economic and social consequences of job loss which contribute to exclusion from society, based on German linked survey and administrative data. In order to study the causal relationship between unemployment and multiple dimensions of social marginalization, I combine inverse propensity score weighting with a difference-in-differences approach. The results suggest that job loss has particularly detrimental effects on the subjective perception of social integration, life satisfaction, access to economic resources and an individual’s mental health. Moreover, this paper shows that becoming unemployed hinders the fulfillment of psychosocial needs that are typically associated with employment, such as social status and higher self-efficacy. The effects of job loss are long-lasting, grow more profound the longer the duration of unemployment and persist following reemployment. Looking at effect heterogeneity, I find that having a partner and being highly educated reduces the negative effects of job loss.

Suggested Citation

  • Pohlan, Laura, 2019. "Unemployment and social exclusion," Journal of Economic Behavior & Organization, Elsevier, vol. 164(C), pages 273-299.
  • Handle: RePEc:eee:jeborg:v:164:y:2019:i:c:p:273-299
    DOI: 10.1016/j.jebo.2019.06.006
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    More about this item

    Keywords

    Job loss; Unemployment; Social exclusion; Inverse probability weighting;

    JEL classification:

    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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