Cash-on-Hand and the duration of job search: Quasi-experimental evidence from Norway

Arbeitspapier

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.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: CESifo Working Paper ; No. 3898

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Duration Analysis; Optimal Timing Strategies ; Macroeconomics: Consumption; Saving; Wealth ; Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity ; Unemployment Insurance; Severance Pay; Plant Closings
• Thema: unemployment ; optimal unemployment insurance ; liquidity constraints ; mental accounting ; severance pay ; regression discontinuity design ; Arbeitslosenversicherung ; Arbeitslosigkeit ; Dauer ; Norwegen

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Basten, Christoph ; Fagereng, Andreas ; Telle, Kjetil
• Ereignis: Veröffentlichung
• (wer): Center for Economic Studies and ifo Institute (CESifo)
• (wo): Munich
• (wann): 2012

Weitere Informationen

• Handle: http://hdl.handle.net/10419/61004
• Letzte Aktualisierung: 10.03.2025, 11:44 MEZ