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Job Displacement, Family Dynamics and Spousal Labor Supply

Martin Halla (), Julia Schmieder () and Andrea Weber ()

No 2018-16, Economics working papers from Department of Economics, Johannes Kepler University Linz, Austria

Abstract: We study the effectiveness of intra-household insurance among married couples when the husband loses his job due to a mass layoff or plant closure. Empirical results based on Austrian administrative data show that husbands suffer persistent employment and earnings losses, while wives’ labor supply increases moderately due to extensive margin responses. Wives’ earnings gains recover only a tiny fraction of the household income loss and, in the short-term, public transfers and taxes are a more important form of insurance. We show that the presence of children in the household is a crucial determinant of the wives’ labor supply response.

Keywords: Firm Events; Household Labor Supply; Intra-household Insurance; Added Worker Effect. (search for similar items in EconPapers)
JEL-codes: D19 J22 J65 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-dem, nep-ias and nep-lab
Date: 2018-11
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Working Paper: Job Displacement, Family Dynamic, and Spousal Labor Supply (2018) Downloads
Working Paper: Job Displacement, Family Dynamics and Spousal Labor Supply (2018) Downloads
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