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Job Insecurity and Financial Distress

Author

Listed:
  • Luigi Moretti,

    () (Universita degli Studi di Padova)

  • Giannetti Caterina
  • Madia Marianna

Abstract

This article 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 – with respect to stable workers – greater job uncertainty for insecure workers increases the probability of being in financial distress similarly to 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

  • Luigi Moretti, & Giannetti Caterina & Madia Marianna, 2014. "Job Insecurity and Financial Distress," Post-Print hal-01411298, HAL.
  • Handle: RePEc:hal:journl:hal-01411298
    DOI: 10.1080/09603107.2013.872759
    Note: View the original document on HAL open archive server: https://hal.archives-ouvertes.fr/hal-01411298
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    More about this item

    Keywords

    job insecurity; financial distress; debt; personal finance;

    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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