The health externalities of downsizing

Alexander Ahammer, Dominik Grübl and Rudolf Winter-Ebmer

No 26, IHS Working Paper Series from Institute for Advanced Studies

Abstract: We show that downsizing has substantial externalities on the health of workers who remainin the firm. To this end, we study mass layoff (ML) survivors in Austria, using workers whosurvive a ML themselves, but a few years in the future, as a control group. Based on high-quality administrative data, we find evidence that downsizing has persistent effects on mentaland physical health, and that these effects can be explained by workers fearing for their ownjobs. We also show that health externalities due to downsizing imply non-negligible cost forfirms, and that wage cuts may have similar effects.

Keywords: Downsizing; mass layoffs; health; job insecurity (search for similar items in EconPapers)
JEL-codes: I12 J23 J63 (search for similar items in EconPapers)
Pages: 48 pages
Date: 2020-12
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

Downloads: (external link)
https://irihs.ihs.ac.at/id/eprint/5585/ First version, 2020 (application/pdf)

Related works:
Working Paper: The Health Externalities of Downsizing (2021)
Working Paper: The health externalities of downsizing (2020)
Working Paper: The Health Externalities of Downsizing (2020)
Working Paper: The health externalities of downsizing (2020)
Working Paper: The health externalities of downsizing (2020)
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