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Your Spouse Is Fired! How Much Do You Care?


  • Nikolova, Milena

    () (University of Groningen)

  • Ayhan, Sinem H.

    () (University of Münster)


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

  • Nikolova, Milena & Ayhan, Sinem H., 2016. "Your Spouse Is Fired! How Much Do You Care?," IZA Discussion Papers 10411, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp10411

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    References listed on IDEAS

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    Cited by:

    1. Lars Kunze & Nicolai Suppa, 2017. "The Effect of Unemployment on Social Participation of Spouses: Evidence from Plant Closures in Germany," SOEPpapers on Multidisciplinary Panel Data Research 898, DIW Berlin, The German Socio-Economic Panel (SOEP).

    More about this item


    unemployment; involuntary job loss; plant closure; spouses; well-being;

    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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