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Does life satisfaction predict reemployment? Evidence form German panel data

Damaris Rose and Olga Stavrova

Journal of Economic Psychology, 2019, vol. 72, issue C, 1-11

Abstract: While life satisfaction has been identified as an important predictor of occupational success, the question of whether it might contribute to reemployment success among unemployed individuals has received much less research attention. Contrasting three theoretical perspectives (motivation theories, positive psychology, and the optimum level of well-being literature), we explored whether life satisfaction has a negative, a positive, or a non-monotonic effect on the likelihood of reemployment. We used large-scale panel data from Germany that gave us the possibility to monitor unemployed individuals’ life satisfaction and labor market outcomes for 10 years. Results of a multi-level discrete-time hazard analysis supported the optimum level of well-being perspective providing evidence for an inverted-U-shaped association between life satisfaction and reemployment probability. Moderate levels of life satisfaction were associated with a stronger likelihood of reemployment than lower or higher levels of life satisfaction. This effect remained robust against controlling for individuals’ socio-economic characteristics, labor market experience and the Big Five personality traits.

Keywords: Life satisfaction; Reemployment; Big Five; Subjective well-being; Unemployment (search for similar items in EconPapers)
JEL-codes: I31 J64 (search for similar items in EconPapers)
Date: 2019
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DOI: 10.1016/j.joep.2018.12.008

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