Boon or Bane? Others' Unemployment, Well-being and Job Insecurity

Andrew Clark, Andreas Knabe and Steffen Rätzel

No 4210, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: The social norm of unemployment suggests that aggregate unemployment reduces the well-being of the employed, but has a far smaller effect on the unemployed. We use German panel data to reproduce this standard result, but then suggest that the appropriate distinction may not be between employment and unemployment, but rather between higher and lower levels of labour-market security, at least for men. Men with good job prospects, both employed and unemployed, are strongly negatively affected by regional unemployment. However, insecure employed men and poor-prospect unemployed men are less negatively, or even positively, affected. There is however no clear relationship for women. We analyse labour-market inequality and unemployment hysteresis in the light of our results.

Keywords: unemployment; externalities; job insecurity; well-being (search for similar items in EconPapers)
JEL-codes: D84 I31 J60 (search for similar items in EconPapers)
Pages: 30 pages
Date: 2009-06
New Economics Papers: this item is included in nep-hap, nep-lab and nep-ltv
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Published - published in: Labour Economics, 2010, 17 (1), 52-61

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Related works:
Journal Article: Boon or bane? Others' unemployment, well-being and job insecurity (2010)
Working Paper: Boon or bane? Others' unemployment, well-being and job insecurity (2010)
Working Paper: Boon or bane? Others' unemployment, well-being and job insecurity (2010)
Working Paper: Boon or Bane? Others' Unemployment, Well-being and Job Insecurity (2008)
Working Paper: Boon or Bane?: Others' Unemployment, Well-Being and Job Insecurity (2008)
Working Paper: Boon or Bane? Others' unemployment, well-being and job insecurity (2008)
Working Paper: Boon or Bane? Others' unemployment, well-being and job insecurity (2008)
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