Temporary overpessimism: Job loss expectations following a large negative employment shock

Arbeitspapier

Job loss expectations were widespread among workers in East Germany aftfter reunification with West Germany. Though experiencing a large negative employment shock, East German workers were still overpessimistic immediately aftfter reunification with respect to their job risk. Over time, job loss expectations fell and converged to West German levels, which was driven by a stabilizing economic environment and by an adaptation of the interpretation of economic signals with workers learning to distinguish individual risk from firm level risk. In fact, conditional on actual job loss risk, East German workers quickly caught up to West Germans regarding the accuracy of job loss expectations.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IAB-Discussion Paper ; No. 5/2021

Classification and Topics

• Classification: Wirtschaft ; Expectations; Speculations ; Unemployment: Models, Duration, Incidence, and Job Search ; Labor Turnover; Vacancies; Layoffs ; Socialist Systems and Transitional Economies: General
• Subject: job loss ; expectations ; transition economies

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Emmler, Julian ; Fitzenberger, Bernd
• Event: Veröffentlichung
• (who): Institut für Arbeitsmarkt- und Berufsforschung (IAB)
• (where): Nürnberg
• (when): 2021

Further information

• Handle: http://hdl.handle.net/10419/234300
• Last update: 10.03.2025, 11:43 AM CET