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The Impact of Tightened Unemployment Benefit Eligibility on Young Adults’ Housing and Use of Private Safety Nets

Author

Listed:
  • Koen Declercq

    (CAPE, UCLouvain - Saint-Louis Bruxelles, Belgium)

  • Muriel Dejemeppe

    (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES))

  • Mathilde Pourtois

    (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES))

Abstract

When access to unemployment benefits (UB) is restricted early in the career, young labour market entrants may rely more on private safety nets, such as the parental home, to insure against unemployment risk. Using a difference-in-differences strategy, this paper investigates the causal impact of a 2015 reform tightening UB eligibility on master’s graduates’ decision to leave the parental home in Belgium. We find that the reform delays home-leaving for young men, especially those who would have chosen shared housing. In contrast, young women respond by increasing labour supply, substituting market income for reduced public insurance to maintain residential independence. These results highlight that restricting UB can trigger broader behavioural responses through both family and labour market channels.

Suggested Citation

  • Koen Declercq & Muriel Dejemeppe & Mathilde Pourtois, 2025. "The Impact of Tightened Unemployment Benefit Eligibility on Young Adults’ Housing and Use of Private Safety Nets," LIDAM Discussion Papers IRES 2026005, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    • Handle: RePEc:ctl:louvir:2026005
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies
    • J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J65 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment Insurance; Severance Pay; Plant Closings
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy

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