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Job Insecurity and Financial Distress

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  • C. Giannetti
  • M. Madia
  • L. Moretti

Abstract

This paper investigates the effects of different job categories on households’ likelihood of experiencing financial distress. Given imperfect financial markets and the absence of unemployment subsidies, households with less secure jobs are likely to experience drops in income more frequently than households with well-protected jobs. Households’ abilities to deal with financial decisions (i.e. financial literacy) can mitigate these problems. Our results suggest that greater job insecurity increases the probability of being in financial distress similarly than other working statuses (e.g. unemployment), and in some cases even more (i.e. part-time workers). However, a high level of financial literacy can counterbalance this effect, especially for atypical workers.

Suggested Citation

  • C. Giannetti & M. Madia & L. Moretti, 2013. "Job Insecurity and Financial Distress," Working Papers wp887, Dipartimento Scienze Economiche, Universita' di Bologna.
  • Handle: RePEc:bol:bodewp:wp887
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    Cited by:

    1. Wai Ming To & Jennifer H. Gao & Ernest Y. W. Leung, 2020. "The Effects of Job Insecurity on Employees’ Financial Well-Being and Work Satisfaction Among Chinese Pink-Collar Workers," SAGE Open, , vol. 10(4), pages 21582440209, December.

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    More about this item

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance

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