News

New Publication: "How Much Does Others' Protection Matter? Employment Protection, Future Labour Market Prospects and Well-Being"

04.08.2019 -

New Publication by Andreas Knabe and Christine Lücke, (online first):

Employment protection legislation (EPL) is an important determinant of workers’ perceived future labour market prospects as well as their subjective well-being. Recent studies indicate that it is not only a worker’s own level of protection, but also the employment protection of other workers that matters for individual prospects and well-being. We contribute to this literature by examining how such cross-effects on well-being are mediated by a workers’ perceived risk of job loss and future employability. We apply a structural model to data from the Third Wave of the European Quality of Life Survey, combined with summary indices from the OECD Employment Protection Database. Our results are indicative of cross-effects. Stricter protection for permanent workers (stricter regulation on the length and number of renewals of fixed-term contracts) is associated with lower (higher) perceived employability for both permanent workers and fixed-term workers. In addition, stricter protection for permanent workers is positively related to fixed-term workers’ perceived risk of job loss. We do find some evidence that EPL has significant indirect (cross-)effects on life satisfaction via the mediators. There are no indications for direct, non-mediated effects.

The Publication can be found here.

New Publication: "Looking Back in Anger? Retirement and Unemployment Scarring"

30.04.2019 -

New Publication by Clemens Hetschko, Andreas Knabe und Ronnie Schöb:

Unemployment affects future working conditions and job security negatively, thus reducing life satisfaction after reemployment. These employment-related scars of unemployment should not matter anymore when a person has retired. Using German panel data, we analyze unemployed persons’ transition into retirement to test whether unemployment leaves scars beyond working life and thus for reasons that are not employment-related. We find that involuntary unemployment between the last job and retirement causes a loss in life satisfaction after retirement. People who influenced or even initiated unemployment, by contrast, show no scarring. The scarring effect goes beyond what can be explained by the income loss originating from reduced pensions. It shows up independently of whether the unemployment spell directly before retirement was the only experience of unemployment in a person’s career, or whether she had also experienced unemployment at earlier times. We do not find evidence that early retirement or involuntary retirement are the reasons why formerly unemployed retirees display unemployment scarring.                                                                                                                                              

The Publication can be found here.

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New Publication: "Reference Income Effects in the Determination of Equivalence Scales Using Income Satisfaction Data"

12.10.2018 -

New Publication by Andreas Knabe, Melanie Borah und Carina Keldenich:

We estimate household equivalence scales, i.e. the needs of additional adults and children relative to a single adult, using income satisfaction data from the German Socio-Economic Panel. We extend previous studies applying this approach by taking reference income into account. This allows separating needs-based from reference effects in the determination of income satisfaction. We show that this adjustment helps to overcome a bias causing an overestimation of adults' and an underestimation of children's needs-based equivalence weights. Our results indicate that controlling for income comparisons substantially increases children's equivalence weight relative to that of adults.

The Publication can be found here.

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New Publication: "When Protection Puts You in Jeopardy -- How Removing Small-Business Clauses Affects Employment Duration"

19.02.2018 -

New publication by Christine Lücke:

In a 2004 reform, Germany exempted small firms from dismissal protection. This paper estimates the effects of dismissal protection on the risk of leaving the establishment, taking advantage of the fact that workers employed before the amendment maintained their previous dismissal protection. Utilizing administrative linked employeremployee data, the results hint at a higher risk during the first 6 months in a job and a lower risk thereafter, if dismissal protection is provided. The estimated survivor curves suggest that even after 5 years the protecting effect of dismissal protection did not compensate the initially adverse effect during the first 6 months of tenure.

 The publication can be found here.

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New Publication: There and back again estimating equivalence scales with measurement error

23.01.2018 -

A new publication by Melanie Borah and Andreas Knabe:

Using income satisfaction data from the German Socio-Economic Panel, we find large differences in the equivalence weight of a partner when it is being estimated by direct and reverse regressions. We argue that neither of the two models will produce consistent estimates when there is stochastic error in satisfaction and measurement error in incomes. We propose a correction of mismeasured incomes using a constructed alternative income measure. The corrected results are relatively close to those obtained from direct regression. We do not find evidence that previous studies, using the direct regression method, severely suffer from measurement error in incomes.

Find the publication here.

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