How Income Changes During Unemployment: Evidence from Tax Return Data
This paper uses tax return data from 1999 to 2009 to provide new estimates of wage losses during unemployment, and to examine how other types of income change dur- ing an unemployment spell. Periods of unemployment are associated with significant reductions in wage income, equivalent to approximately 16% of pre-unemployment household-level earnings and 30% of individual-level earnings. Households partially compensate for these wage losses in ways that vary across groups: Spousal earnings increase in the case of married couples, filers more likely to have accrued financial and housing wealth realize greater amounts of capital gains, and older filers take early withdrawals from restricted savings accounts. More generous UI benefits crowd out wage income of unemployed workers, but have mostly small or zero effect on spousal earnings and non-wage income.
Year of publication: |
2013-03
|
---|---|
Authors: | LaLumia, Sara ; Kawano, Laura |
Institutions: | Economics Department, Williams College |
Saved in:
freely available
Saved in favorites
Similar items by person
-
How Income Changes During Unemployment: Evidence from Tax Return Data
LaLumia, Sara, (2013)
-
The Value of Honesty: Empirical Estimates from the Case of the Missing Children
LaLumia, Sara, (2011)
-
The EITC, Tax Refunds, and Unemployment Spells
LaLumia, Sara, (2011)
- More ...