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Intergenerational Transmission of Unemployment – Causal Evidence from Austria

Author

Listed:
  • Dominik Grübl
  • Mario Lackner
  • Rudolf Winter-Ebmer

Abstract

We estimate the causal effect of parents’ unemployment on unemployment among their children in their own adulthood. We use administrative data for Austrian children born between 1974 and 1984 and apply an instrumental variables (IV) identification strategy using parents' job loss during a mass layoff as the instrument. We find evidence of unemployment inheritance in the next generation. An additional day of unemployment during childhood causally raises the average unemployment days of the adult child by 1 to 2%. The greatest effects are observed for unmarried parents, young children, children of low-education parents, and in families living in capital cities. We also explore various channels of intergenerational unemployment, such as education, income, and job matching by parents.

Suggested Citation

  • Dominik Grübl & Mario Lackner & Rudolf Winter-Ebmer, 2020. "Intergenerational Transmission of Unemployment – Causal Evidence from Austria," CDL Aging, Health, Labor working papers 2020-01, The Christian Doppler (CD) Laboratory Aging, Health, and the Labor Market, Johannes Kepler University Linz, Austria.
    • Handle: RePEc:jku:cdlwps:wp2001
    Note: English
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    Cited by:

    1. Bicakova, Alena & Kaliskova, Klara, 2022. "Is Longer Maternal Care Always Beneficial? The Impact of a Four-Year Paid Parental Leave," IZA Discussion Papers 15640, Institute of Labor Economics (IZA).
    2. Cobb-Clark, Deborah A. & Dahmann, Sarah C. & Gielen, Anne C., 2024. "The intergenerational effects of requiring unemployment benefit recipients to engage in non-search activities," Labour Economics, Elsevier, vol. 91(C).
    3. Jim Been & Anne C. Gielen & Marike Knoef & Gloria Moroni, 2022. "Prolonged worklife among grandfathers: Spillover effects on grandchildren's educational outcomes," Tinbergen Institute Discussion Papers 22-033/V, Tinbergen Institute.

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    Keywords

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    JEL classification:

    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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