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Your Spouse Is Fired! How Much Do You Care?

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  • Milena Nikolova
  • Sinem Ayhan

Abstract

This study is the first to provide a causal estimate of the subjective well-being effects of spousal unemployment at the couple level. Using German panel data on married and cohabiting partners for 1991-2013 and information on exogenous job termination induced by workplace closure, we show that spousal unemployment reduces the life satisfaction of indirectly-affected spouses. The impact is equally pronounced among female and male partners. Importantly, the results are not driven by an income effect, but likely reflect the psychological costs of unemployment. Our findings are robust to a battery of sensitivity checks and imply that public policy programs aimed at mitigating the negative consequences of unemployment need to consider within-couple spillovers.

Suggested Citation

  • Milena Nikolova & Sinem Ayhan, 2016. "Your Spouse Is Fired! How Much Do You Care?," SOEPpapers on Multidisciplinary Panel Data Research 891, DIW Berlin, The German Socio-Economic Panel (SOEP).
  • Handle: RePEc:diw:diwsop:diw_sp891
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    Cited by:

    1. Nikolova Milena & Popova Olga, 2021. "Sometimes Your Best Just Ain’t Good Enough: The Worldwide Evidence on Subjective Well-being Efficiency," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 21(1), pages 83-114, January.
    2. Adrian Chadi & Clemens Hetschko, 2021. "How Job Changes Affect People's Lives — Evidence from Subjective Well‐Being Data," British Journal of Industrial Relations, London School of Economics, vol. 59(2), pages 279-306, June.
    3. Juliane Hennecke & Astrid Pape, 2020. "Suddenly a Stay-At-Home Dad? Short- and Long-term Consequences of Fathers’ Job Loss on Time Investment in the Household," SOEPpapers on Multidisciplinary Panel Data Research 1112, DIW Berlin, The German Socio-Economic Panel (SOEP).
    4. Hetschko, Clemens & Schöb, Ronnie & Wolf, Tobias, 2020. "Income support, employment transitions and well-being," Labour Economics, Elsevier, vol. 66(C).
    5. Lars Kunze & Nicolai Suppa, 2020. "The effect of unemployment on social participation of spouses: evidence from plant closures in Germany," Empirical Economics, Springer, vol. 58(2), pages 815-833, February.
    6. Vanessa Gash & Anke C Plagnol, 2021. "The Partner Pay Gap: Associations between Spouses’ Relative Earnings and Life Satisfaction among Couples in the UK," Work, Employment & Society, British Sociological Association, vol. 35(3), pages 566-583, June.
    7. Nikolova, Milena, 2019. "Switching to self-employment can be good for your health," Journal of Business Venturing, Elsevier, vol. 34(4), pages 664-691.
    8. Nikolova, Milena & Cnossen, Femke, 2020. "What makes work meaningful and why economists should care about it," Labour Economics, Elsevier, vol. 65(C).
    9. Suppa, Nicolai, 2021. "Unemployment and subjective well-being," GLO Discussion Paper Series 760, Global Labor Organization (GLO).
    10. Lars Kunze & Nicolai Suppa, 2020. "Who Is Bowling Alone? Quantile Treatment Effects of Unemployment on Social Participation," SOEPpapers on Multidisciplinary Panel Data Research 1077, DIW Berlin, The German Socio-Economic Panel (SOEP).
    11. Scheuring, Sonja & Voßemer, Jonas & Baranowska-Rataj, Anna & Tattarini, Giulia, 2021. "Does Fixed-Term Employment Have Spillover Effects on the Well-Being of Partners? A Panel Data Analysis for East and West Germany," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics.
    12. Nikolova, Milena, 2018. "Self-Employment Can Be Good for Your Health," GLO Discussion Paper Series 226, Global Labor Organization (GLO).
    13. Carol Graham, 2005. "The Economics of Happiness," World Economics, World Economics, 1 Ivory Square, Plantation Wharf, London, United Kingdom, SW11 3UE, vol. 6(3), pages 41-55, July.

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    More about this item

    Keywords

    Unemployment; involuntary job loss; plant closure; spouses; well-being;
    All these keywords.

    JEL classification:

    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
    • J65 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment Insurance; Severance Pay; Plant Closings

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