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.
Halla, Martin, Julia Schmieder, and Andrea Weber.
"Job Displacement, Family Dynamics, and Spousal Labor Supply."
American Economic Journal: Applied Economics,
Household Production and Intrahousehold Allocation
Marriage; Marital Dissolution; Family Structure; Domestic Abuse
Economics of Gender; Non-labor Discrimination
Time Allocation and Labor Supply
Wage Level and Structure; Wage Differentials
Labor Turnover; Vacancies; Layoffs