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Contribution Details

Type Journal Article
Scope Discipline-based scholarship
Title Cash-on-hand and the Duration of Job Search: Quasi-experimental Evidence from Norway
Organization Unit
Authors
  • Christoph Basten
  • Andreas Fagereng
  • Kjetil Telle
Item Subtype Original Work
Refereed Yes
Status Published in final form
Language
  • English
Journal Title Economic Journal
Publisher Wiley-Blackwell Publishing, Inc.
Geographical Reach international
ISSN 0013-0133
Volume 124
Number 576
Page Range 540 - 568
Date 2014
Abstract Text We identify the causal effect of lump-sum severance payments on non-employment duration in Norway by exploiting a discontinuity in eligibility at the age of 50. We find that a payment worth 1.2 months' earnings at the median lowers the fraction re-employed after a year by about 8 percentage points. This is what we would expect if liquidity constraints force unemployed workers to accept a job offer earlier than would be optimal. As further support for the liquidity interpretation, we use data on wealth before unemployment to show that the effect of non-employment duration occurs for the non-wealthy only.
Digital Object Identifier 10.1111/ecoj.12135
Other Identification Number merlin-id:16125
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