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Intergenerational Transmission of Unemployment – Causal Evidence from Austria

Dominik Grübl, Mario Lackner () and Rudolf Winter-Ebmer ()

No 2020-05, Economics working papers from Department of Economics, Johannes Kepler University Linz, Austria

Abstract: We estimate the causal effect of parents’ unemployment on unemployment among their children in their own adulthood. We use administrative data for Austrian children born between 1974 and 1984 and apply an instrumental variables (IV) identification strategy using parents’ job loss during a mass layoff as the instrument. We find evidence of unemployment inheritance in the next generation. An additional day of unemployment during childhood causally raises the average unemployment days of the adult child by 1 to 2%. The greatest effects are observed for unmarried parents, young children, children of low-education parents, and in families living in capital cities. We also explore various channels of intergenerational unemployment, such as education, income, and job matching by parents.

Keywords: intergenerational transmission; mass layoff; unemployment duration; instrumental variable (search for similar items in EconPapers)
JEL-codes: J62 J64 (search for similar items in EconPapers)
Date: 2020-03
New Economics Papers: this item is included in nep-eur and nep-lab
Note: English
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Working Paper: Intergenerational Transmission of Unemployment - Causal Evidence from Austria (2020) Downloads
Working Paper: Intergenerational Transmission of Unemployment - Causal Evidence from Austria (2020) Downloads
Working Paper: Intergenerational Transmission of Unemployment: Causal Evidence from Austria (2020) Downloads
Working Paper: Intergenerational Transmission of Unemployment – Causal Evidence from Austria (2020) Downloads
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