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Does Job Insecurity Deteriorate Health ? A Causal Approach for Europe


  • Eve Caroli

    () (University Paris Dauphine)

  • Mathilde Godard

    () (CREST)


This paper estimates the causal effect of perceived job insecurity - i.e. the fear of involuntary job loss - on health in a sample of 22 European countries. We rely on an original instrumental variable approach based on the idea that workers perceive greater job security in countries where employment is strongly protected by the law, and relatively more so if employed in industries where employment protection legislation is more binding, i.e. in industries with a higher natural rate of dismissals. Using cross-country data from the 2010 European Working Conditions Survey, we show that when the potential endogeneity of job insecurity is not accounted for, the latter appears to deteriorate almost all health outcomes. After controlling for endogeneity, the health-damaging effect of job insecurity is confirmed for a subgroup of health outcomes, namely self-rated health, being sick in the past 12 months, suffering from skin problems, headaches or eyestrain and stomach ache. As for other health variables, the impact of job insecurity appears to be insignificant at conventional

Suggested Citation

  • Eve Caroli & Mathilde Godard, 2013. "Does Job Insecurity Deteriorate Health ? A Causal Approach for Europe," Working Papers 2013-13, Center for Research in Economics and Statistics.
  • Handle: RePEc:crs:wpaper:2013-13

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    Cited by:

    1. Rohde, Nicholas & Tang, K.K. & Osberg, Lars & Rao, Prasada, 2016. "The effect of economic insecurity on mental health: Recent evidence from Australian panel data," Social Science & Medicine, Elsevier, vol. 151(C), pages 250-258.
    2. Bassanini, Andrea & Caroli, Eve, 2014. "Is work bad for health? The role of constraint vs choice," CEPREMAP Working Papers (Docweb) 1402, CEPREMAP.
    3. Thomas Barnay, 2016. "Health, work and working conditions: a review of the European economic literature," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 17(6), pages 693-709, July.
    4. Pirani, Elena & Salvini, Silvana, 2015. "Is temporary employment damaging to health? A longitudinal study on Italian workers," Social Science & Medicine, Elsevier, vol. 124(C), pages 121-131.
    5. Daniele Vignoli & Valentina Tocchioni & Silvana Salvini, 2015. "Uncertain Lives. Insights into the Role of Job Precariousness in Union Formation," Econometrics Working Papers Archive 2015_02, Universita' degli Studi di Firenze, Dipartimento di Statistica, Informatica, Applicazioni "G. Parenti".
    6. Gutierrez, Italo A. & Michaud, Pierre-Carl, 2015. "Employer Downsizing and Older Workers' Health," IZA Discussion Papers 9140, Institute for the Study of Labor (IZA).
    7. Elena Pirani & Silvana Salvini, 2014. "Is temporary employment damaging to health? A longitudinal study on Italian workers," Econometrics Working Papers Archive 2014_08, Universita' degli Studi di Firenze, Dipartimento di Statistica, Informatica, Applicazioni "G. Parenti".
    8. Moscone, F. & Tosetti, E. & Vittadini, G., 2016. "The impact of precarious employment on mental health: The case of Italy," Social Science & Medicine, Elsevier, vol. 158(C), pages 86-95.
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    10. Daniele Vignoli & Valentina Tocchioni & Silvana Salvini, 2016. "Uncertain lives: Insights into the role of job precariousness in union formation in Italy," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 35(10), pages 253-282, August.
    11. Elena Cottini & Paolo Ghinetti, 2016. "Employment insecurity and employees’ health in Denmark," DISCE - Working Papers del Dipartimento di Economia e Finanza def045, Università Cattolica del Sacro Cuore, Dipartimenti e Istituti di Scienze Economiche (DISCE).

    More about this item


    Job insecurity; Health; Instrumental Variables;

    JEL classification:

    • I19 - Health, Education, and Welfare - - Health - - - Other
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs

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