Home-ownership, unemployed’s job search behavior and post-unemployment outcomes

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. www.econstor.eu The Institute for the Study of Labor (IZA) in Bonn is a local and virtual international research center and a place of communication between science, politics and business. IZA is an independent nonprofit organization supported by Deutsche Post Foundation. The center is associated with the University of Bonn and offers a stimulating research environment through its international network, workshops and conferences, data service, project support, research visits and doctoral program. IZA engages in (i) original and internationally competitive research in all fields of labor economics, (ii) development of policy concepts, and (iii) dissemination of research results and concepts to the interested public. Terms of use: Documents in D I S C U S S I O N P A P E R S E R I E SIZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be available directly from the author. Although home-ownership has been shown to restrict geographic labor mobility and to affect job search behavior of unemployed, there is no evidence so far on how it affects their future re-employment outcomes. We use two waves of detailed German survey data of newly unemployed individuals to study the effect of home-ownership on the job search behavior of unemployed and their re-employment outcomes. We show that unemployed who own a home are less willing to move and also less likely to apply for jobs for which one would have to move. However, we do not find any evidence for compensations of their restricted mobility by more intensive (more search channels or applications) or different (more active or informal) search behavior. Furthermore, we find that home-ownership does not seem to harm the employment prospects of the unemployed. Although the re-employment probability in the short-run is slightly lower, we find that after one year home-owning unemployed have found better re-employment jobs, in terms of wages and job satisfaction, than their renting counterparts.JEL Classification: J64, J61

Does eliminating benefit eligibility requirements improve unemployed job search and labour market outcomes?

“…As we match respondents across time, we include nine covariates to control for changes in labour market environment. Following Gerards and Welters (2020) and Caliendo, Gielen, and Mahlstedt (2015), we apply PSM using the Epanechnikov kernel and a bandwidth of 0.06. The mean and median standardized biases in Table 1 summarize successful matching; all are well below the recommended 3-5% range (Caliendo and Kopeinig 2008).…”

Liquidity Constraints, Unemployed Job Search and Labour Market Outcomes

“…We follow Caliendo, Gielen and Mahlstedt (), Caliendo and Künn () and Caliendo, Künn and Weißenberger () and apply PSM to estimate the effect of an independent variable of interest at year ‘ t ’ – in our case, the incidence of liquidity constraints – on job search intensity at ‘ t ’, ‘time to employment’ and ‘time in employment’ between years ‘ t ’ and ‘ t +1’, employment status at ‘ t +1’, job quality at ‘ t +1’ and employment stability at ‘ t +2’ (if employed at ‘ t +1’). Some of the dependent variables will be observed conditionally on employment at ‘ t +1’, raising the risk of sample selection, which the PSM procedure will not address.…”

Fixed‐Rate Mortgages, Labor Markets, and Efficiency

“…The coefficient of homeowners in the mobility hazard regression in Table 4 is −0.2159, so homeownership decreases the mobility hazard by e −0.2159 − 1 = −19%. All papers below, except Barcelo (2006) and Caliendo, Gielen, and Mahlstedt (2015), use the hazard rate, and the coefficients will be interpreted in an analogous manner. has little effect on homeownership and the presence of children has a negative effect on homeownership in their estimation of the selection equation.…”

“…Based on a sample of 2000–5 unemployment spells of the Dutch population, Kantor, Nijkamp, and Rouwendal () show that homeownership has a negative and significant effect on the hazard rate to leave unemployment for nonlocal jobs, reducing the mobility hazard by 34%. Using data of unemployed individuals between 2007 and 2008 in Germany, Caliendo, Gielen, and Mahlstedt () estimate the effect of homeownership on the probability of unemployed individuals to move for employment. Their estimation results, based on a propensity score matching approach, show that homeownership reduces the probability of applying for jobs that would require moving by 4.5% points and the probability of moving for employment by 3% points.…”

“…The coefficient of homeowners in the mobility hazard regression in Table is −0.2159, so homeownership decreases the mobility hazard by . All papers below, except Barcelo () and Caliendo, Gielen, and Mahlstedt (), use the hazard rate, and the coefficients will be interpreted in an analogous manner.…”