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Crisis, unemployment and psychological wellbeing in Canada


  • Latif, Ehsan


Using longitudinal Canadian data, this paper explores the impact of unemployment on psychological wellbeing. To control for unobserved individual specific heterogeneity, this paper adopted sophisticated econometric techniques. The study suggests that unemployment has significant negative effect on psychological wellbeing and the paper finds that non-pecuniary costs of unemployment is much larger than the pecuniary costs associated with the loss of income while unemployed. The paper further finds that for individuals aged 15-54, being out of labor force also has adverse impact on psychological wellbeing. The study concludes that unemployment is more likely involuntary and thus in the face of unemployment, the policy makers need to use all possible ways to create jobs.

Suggested Citation

  • Latif, Ehsan, 2010. "Crisis, unemployment and psychological wellbeing in Canada," Journal of Policy Modeling, Elsevier, vol. 32(4), pages 520-530, July.
  • Handle: RePEc:eee:jpolmo:v:32:y::i:4:p:520-530

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    References listed on IDEAS

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    9. Helliwell, John F., 2003. "How's life? Combining individual and national variables to explain subjective well-being," Economic Modelling, Elsevier, vol. 20(2), pages 331-360, March.
    10. Eva M. Berger, 2009. "Maternal Employment and Happiness: The Effect of Non-Participation and Part-Time Employment on Mothers' Life Satisfaction," Discussion Papers of DIW Berlin 890, DIW Berlin, German Institute for Economic Research.
    11. Winkelmann, Liliana & Winkelmann, Rainer, 1998. "Why Are the Unemployed So Unhappy? Evidence from Panel Data," Economica, London School of Economics and Political Science, vol. 65(257), pages 1-15, February.
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    Cited by:

    1. Nikoloski, Zlatko & Ajwad, Mohamed Ihsan, 2013. "Do economic crises lead to health and nutrition behavior responses ? analysis using longitudinal data from Russia," Policy Research Working Paper Series 6538, The World Bank.
    2. Grogan, Louise & Koka, Katerina, 2013. "Economic crises and wellbeing: Social norms and home production," Journal of Economic Behavior & Organization, Elsevier, vol. 92(C), pages 241-258.
    3. Peter Meer, 2014. "Gender, Unemployment and Subjective Well-Being: Why Being Unemployed Is Worse for Men than for Women," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 115(1), pages 23-44, January.
    4. Tsui, Hsiao-Chien, 2014. "What affects happiness: Absolute income, relative income or expected income?," Journal of Policy Modeling, Elsevier, vol. 36(6), pages 994-1007.
    5. Latif, Ehsan, 2014. "The impact of recession on drinking and smoking behaviours in Canada," Economic Modelling, Elsevier, vol. 42(C), pages 43-56.
    6. Ehsan Latif, 2016. "Happiness and Comparison Income: Evidence from Canada," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 128(1), pages 161-177, August.
    7. Labeaga, José M. & Molina, José Alberto & Navarro, María, 2011. "Deprivation using satisfaction measures in Spain: An evaluation of unemployment benefits," Journal of Policy Modeling, Elsevier, vol. 33(2), pages 287-310, March.
    8. Ehsan Latif, 2015. "Happiness Adaptation to Income: Evidence from Canada," Economics Bulletin, AccessEcon, vol. 35(3), pages 1477-1487.


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