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Income support, employment transitions and well-being

Clemens Hetschko, Ronnie Schöb, Tobias Wolf – 2020

Using specific panel data of German welfare benefit recipients, we investigate the non-pecuniary life satisfaction effects of in-work benefits. Our empirical strategy combines difference-in-difference designs with synthetic control groups to analyse transitions of workers between unemployment, regular employment and employment accompanied by welfare receipt. Working makes people generally better off than being unemployed but employed welfare recipients do not reach the life satisfaction level of regular employees. This implies that welfare receipt entails non-compliance with the norm to make one's own living. Our findings allow us to draw cautious conclusions on employment subsidies paid as welfare benefits.

Title
Income support, employment transitions and well-being
Publisher
Labour Economics
Date
2020-10
Identifier
101887
Source(s)
Appeared in
vol. 66
Type
Text