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  3. American Economic Journal: Applied Economics
  4. October 2020
  5. Job Displacement, Family Dynamics, and Spousal Labor Supply

Job Displacement, Family Dynamics, and Spousal Labor Supply

  • Martin Halla
  • Julia Schmieder
  • Andrea Weber
American Economic Journal: Applied Economics
vol. 12, no. 4, October 2020
(pp. 253-87)
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Abstract

We study the effectiveness of intrahousehold 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.

Citation

Halla, Martin, Julia Schmieder, and Andrea Weber. 2020. "Job Displacement, Family Dynamics, and Spousal Labor Supply." American Economic Journal: Applied Economics, 12 (4): 253-87. DOI: 10.1257/app.20180671

Additional Materials

JEL Classification

  • D13 Household Production and Intrahousehold Allocation
  • J12 Marriage; Marital Dissolution; Family Structure; Domestic Abuse
  • J16 Economics of Gender; Non-labor Discrimination
  • J22 Time Allocation and Labor Supply
  • J31 Wage Level and Structure; Wage Differentials
  • J63 Labor Turnover; Vacancies; Layoffs
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