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Family matters: The effects of parental unemployment in early childhood and adolescence on subjective well-being later in life

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  • Nikolova, Milena
  • Nikolaev, Boris N.

Abstract

We are the first to examine how parental unemployment experienced during early-, mid- and late-childhood affects adult life satisfaction. Using German household panel data, we find that parental unemployment induced by plant closures and experienced during early (0–5 years) and late (11–15 years) childhood leads to lower life satisfaction at ages 18–31. Nevertheless, parental unemployment can also have a positive effect depending on the age and gender of the child. Our results are robust even after controlling for local unemployment, individual and family characteristics, parental job loss expectations, financial resources, and parents’ working time when growing up. These findings imply that the adverse effects associated with parental unemployment experienced at a young age tend to last well into young adulthood and are more nuanced than previously thought.

Suggested Citation

  • Nikolova, Milena & Nikolaev, Boris N., 2021. "Family matters: The effects of parental unemployment in early childhood and adolescence on subjective well-being later in life," Journal of Economic Behavior & Organization, Elsevier, vol. 181(C), pages 312-331.
  • Handle: RePEc:eee:jeborg:v:181:y:2021:i:c:p:312-331
    DOI: 10.1016/j.jebo.2018.05.005
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    1. Ruiz-Valenzuela, Jenifer, 2020. "Intergenerational effects of employment protection reforms," LSE Research Online Documents on Economics 104016, London School of Economics and Political Science, LSE Library.
    2. Tetsuya Tsurumi & Rintaro Yamaguchi & Kazuki Kagohashi & Shunsuke Managi, 2021. "Are Cognitive, Affective, and Eudaimonic Dimensions of Subjective Well-Being Differently Related to Consumption? Evidence from Japan," Journal of Happiness Studies, Springer, vol. 22(6), pages 2499-2522, August.
    3. Mine Kühn & Anna Baranowska & Niina Metsä-Simola & Liina M. Junna & Pekka Martikainen, 2022. "The effects of unemployment among single mothers on adolescent children’s mental health," MPIDR Working Papers WP-2022-026, Max Planck Institute for Demographic Research, Rostock, Germany.
    4. Mörk, Eva & Sjögren, Anna & Svaleryd, Helena, 2019. "Consequences of parental job loss on the family environment and on human capital formation - Evidence from plant closures," Working Paper Series 2019:7, Uppsala University, Department of Economics.
    5. Angelini, Viola & Mierau, Jochen O. & Viluma, Laura, 2021. "Socioeconomic Conditions in Childhood and Mental Health Later in Life," GLO Discussion Paper Series 844, Global Labor Organization (GLO).
    6. Aysun Gündoğan, 2022. "“Hear my Voice”: Subjective Well-Being Scale for Young Children (SWB-YC)," Child Indicators Research, Springer;The International Society of Child Indicators (ISCI), vol. 15(3), pages 747-761, June.
    7. Liwen Chen & Bobby Chung & Guanghua Wang, 2022. "Stay-at-Home Peer Mothers and Gender Norms: Short-run Effects on Educational Outcomes," Working Papers 2022-039, Human Capital and Economic Opportunity Working Group.

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    More about this item

    Keywords

    Life satisfaction; Parental unemployment; Company closures; Life-cycle analysis; German socio-economic panel;
    All these keywords.

    JEL classification:

    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
    • J65 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment Insurance; Severance Pay; Plant Closings

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