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  5. Effects of Parental Death on Labor Market Outcomes

American Economic Review

ISSN 0002-8282 (Print) | ISSN 1944-7981 (Online)

Effects of Parental Death on Labor Market Outcomes

  • Mathias Fjællegaard Jensen
  • Ning Zhang
American Economic Review
vol. 116, no. 5, May 2026
(pp. 1811–36)
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Abstract

We use Danish administrative data to examine the effects of parental death on labor market outcomes. Leveraging the timing of sudden, first parental deaths and a matched-control difference-in-differences strategy, we find that men's earnings decline by 2 percent, while women's earnings decline by 3 percent following a parental death. Both women and men experience mental health deterioration, leading to increased use of psychological assistance and prescriptions for mental health conditions and opioids. Women with young children experience a comparatively larger earnings decline (around 4 percent) likely due to the loss of informal childcare.

Citation

Jensen, Mathias Fjællegaard, and Ning Zhang. 2026. "Effects of Parental Death on Labor Market Outcomes." American Economic Review 116 (5): 1811–36. DOI: 10.1257/aer.20240432

Additional Materials

JEL Classification

  • D91 Micro-Based Behavioral Economics: Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
  • I12 Health Behavior
  • J13 Fertility; Family Planning; Child Care; Children; Youth
  • J16 Economics of Gender; Non-labor Discrimination
  • J31 Wage Level and Structure; Wage Differentials