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Cash-on-hand and the duration of job search, quasi-experimental evidence from Norway, Christoph Basten, Andreas Fagereng, Kjetil Telle

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Cash-on-hand and the duration of job search, quasi-experimental evidence from Norway, Christoph Basten, Andreas Fagereng, Kjetil Telle
Language
eng
Abstract
We identify the causal effect of lump-sum severance payments on non-employment duration in Norway by exploiting a discontinuity in eligibility at age 50. We find that a severance payment worth 1.2 months' earnings at the median lowers the fraction re-employed after a year by seven percentage points. Data on household wealth enable us to verify that the effect is decreasing in prior wealth, which favors an interpretation as liquidity constraints over the alternative of mental accounting. Finding liquidity constraints in Norway, despite its equitable wealth distribution and generous welfare state, means they are likely to exist also in other countries
Index
no index present
Literary form
non fiction
Main title
Cash-on-hand and the duration of job search
Oclc number
851517313
Responsibility statement
Christoph Basten, Andreas Fagereng, Kjetil Telle
Series statement
EUI working papers. ECO, 2012/21EUI papers
Sub title
quasi-experimental evidence from Norway

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