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

Andrew Clark (), Andreas Knabe () and Steffen Rätzel

No 4210, IZA Discussion Papers from Institute for the Study of Labor (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: job insecurity; externalities; unemployment; well-being (search for similar items in EconPapers)
JEL-codes: I31 D84 J60 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-hap, nep-lab and nep-ltv
Date: 2009-06
View list of references

Forthcoming in: Labour Economics

Downloads: (external link)
http://ftp.iza.org/dp4210.pdf (application/pdf)

Related works:
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)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:iza:izadps:dp4210

Ordering information: This working paper can be ordered from
IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany

Access Statistics for this paper

More papers in IZA Discussion Papers from Institute for the Study of Labor (IZA)
Address: IZA, P.O. Box 7240, D-53072 Bonn, Germany
Contact information at EDIRC.
Series data maintained by Mark Fallak ().