Regional unemployment and norm-induced effects on life satisfaction

Adrian Chadi

Empirical Economics, 2014, vol. 46, issue 3, 1141 pages

Abstract: While rising unemployment generally reduces people’s happiness, researchers argue that there is a compensating social-norm effect for the unemployed individual, who might suffer less when it is more common to be unemployed. This empirical study rejects this thesis for German panel data, however, and finds that individual unemployment is even more hurtful when regional unemployment is higher. On the other hand, an extended model that separately considers individuals who feel stigmatised from living off public funds yields strong evidence that this group of people does in fact suffer less when the normative pressure to earn one’s own living is lower. A comprehensive discussion reconciles these findings with the existing research and concludes that to find evidence for the often described social-norm effect it is worthwhile to analyse disutility associated with benefit receipts. Copyright Springer-Verlag Berlin Heidelberg 2014

Keywords: Social norms; Regional unemployment; Individual unemployment; Well-being; Social benefits; Labour market policies; I3; J6 (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (33)

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Related works:
Working Paper: Regional Unemployment and Norm-Induced Effects on Life Satisfaction (2013)
Working Paper: Regional Unemployment and Norm-Induced Effects on Life Satisfaction (2011)
Working Paper: Regional unemployment and norm-induced effects on life satisfaction (2011)
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DOI: 10.1007/s00181-013-0712-7

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