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Unemployment and Identity

  • Ronnie Schöb

This article employs social identity and self-categorization theories as a useful heuristic framework through which to learn more about the nature of the misery experienced by the unemployed; in economic terms, the individual cost of unemployment. Utilizing this framework, the article provides different empirical identification strategies in order to disentangle the various means through which unemployment alters both the well-being and utility of an individual and shows, by reviewing some of the recent research in which I have participated, that unemployment primarily threatens an individual's identity rather than reducing the instantaneous utility derived from day-to-day experiences. Copyright The Author 2012. Published by Oxford University Press on behalf of Ifo Institute, Munich. All rights reserved. For permissions, please email:, Oxford University Press.

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Article provided by CESifo in its journal CESifo Economic Studies.

Volume (Year): 59 (2013)
Issue (Month): 1 (March)
Pages: 149-180

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Handle: RePEc:oup:cesifo:v:59:y:2013:i:1:p:149-180
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  1. Andrew E. Clark & Andreas Knabe & Steffen Rätzel, 2008. "Boon or Bane? Others' unemployment, well-being and job insecurity," PSE Working Papers halshs-00586022, HAL.
  2. Andreas Knabe & Steffen Rätzel & Ronnie Schöb & Joachim Weimann, 2010. "Dissatisfied with Life but Having a Good Day: Time-use and Well-being of the Unemployed," Economic Journal, Royal Economic Society, vol. 120(547), pages 867-889, 09.
  3. Bruno S. Frey & Alois Stutzer, 2001. "What Can Economists Learn from Happiness Research?," CESifo Working Paper Series 503, CESifo Group Munich.
  4. Andreas Knabe & Steffen Rätzel, 2007. "Quantifying the Psychological Costs of Unemployment: The Role of Permanent Income," SOEPpapers on Multidisciplinary Panel Data Research 32, DIW Berlin, The German Socio-Economic Panel (SOEP).
  5. Krueger, Alan B. & Mueller, Andreas I., 2008. "The Lot of the Unemployed: A Time Use Perspective," IZA Discussion Papers 3490, Institute for the Study of Labor (IZA).
  6. Blanchflower, David G. & Oswald, Andrew J., 2001. "Well-Being Over Time in Britain and the USA," The Warwick Economics Research Paper Series (TWERPS) 616, University of Warwick, Department of Economics.
  7. Layard, Richard & Nickell, Stephen & Jackman, Richard, 1991. "Unemployment: Macroeconomic Performance and the Labour Market," OUP Catalogue, Oxford University Press, number 9780198284345.
  8. Paul Dolan & Daniel Kahneman, 2008. "Interpretations Of Utility And Their Implications For The Valuation Of Health," Economic Journal, Royal Economic Society, vol. 118(525), pages 215-234, 01.
  9. Alois Stutzer & Rafael Lalive, 2004. "The Role of Social Work Norms in Job Searching and Subjective Well-Being," Journal of the European Economic Association, MIT Press, vol. 2(4), pages 696-719, 06.
  10. Krueger, Alan B. & Schkade, David A., 2008. "The reliability of subjective well-being measures," Journal of Public Economics, Elsevier, vol. 92(8-9), pages 1833-1845, August.
  11. Andreas Knabe & Steffen Rätzel, 2008. "Scarring or Scaring? The Psychological Impact of Past Unemployment and Future Unemployment Risk," FEMM Working Papers 08013, Otto-von-Guericke University Magdeburg, Faculty of Economics and Management.
  12. Michael Shields & Stephen Wheatley Price & Mark Wooden, 2009. "Life satisfaction and the economic and social characteristics of neighbourhoods," Journal of Population Economics, Springer, vol. 22(2), pages 421-443, April.
  13. Clemens Hetschko & Andreas Knabe & Ronnie Schöb, 2011. "Changing Identity: Retiring from Unemployment," FEMM Working Papers 110017, Otto-von-Guericke University Magdeburg, Faculty of Economics and Management.
  14. Clark, Andrew E & Oswald, Andrew J, 1994. "Unhappiness and Unemployment," Economic Journal, Royal Economic Society, vol. 104(424), pages 648-59, May.
  15. Andreas Knabe & Ronnie Schöb & Joachim Weimann, 2012. "Partnership, Gender Roles and the Well-Being Cost of Unemployment," FEMM Working Papers 120019, Otto-von-Guericke University Magdeburg, Faculty of Economics and Management.
  16. repec:hal:wpaper:halshs-00586022 is not listed on IDEAS
  17. Adrian Chadi, 2013. "Regional Unemployment and Norm-Induced Effects on Life Satisfaction," IAAEU Discussion Papers 201306, Institute of Labour Law and Industrial Relations in the European Union (IAAEU).
  18. Andrew E. Clark, 2003. "Unemployment as a Social Norm: Psychological Evidence from Panel Data," Journal of Labor Economics, University of Chicago Press, vol. 21(2), pages 289-322, April.
  19. Nattavudh Powdthavee, 2007. "Are there Geographical Variations in the Psychological Cost of Unemployment in South Africa?," Social Indicators Research, Springer, vol. 80(3), pages 629-652, February.
  20. Besley, Timothy & Coate, Stephen, 1992. "Workfare versus Welfare Incentive Arguments for Work Requirements in Poverty-Alleviation Programs," American Economic Review, American Economic Association, vol. 82(1), pages 249-61, March.
  21. Rainer Winkelmann, 2009. "Unemployment, Social Capital, and Subjective Well-Being," Journal of Happiness Studies, Springer, vol. 10(4), pages 421-430, August.
  22. 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.
  23. George A. Akerlof & Rachel E. Kranton, 2000. "Economics And Identity," The Quarterly Journal of Economics, MIT Press, vol. 115(3), pages 715-753, August.
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