Asger Lau Andersen, Amalie Jensen, Niels Johannesen, Claus Thustrup Kreiner, Søren Leth-Petersen, Adam Sheridan, 08 June 2021

To what extent do households self-insure to avoid cutting back on consumption following income losses, and which self-insurance channels are most important? This column reviews evidence on household responses to job loss using comprehensive high-frequency data from multiple sources in Denmark. Over the two years following job loss, 30% of the decline in disposable income is accounted for by a drop in household spending, leaving a gap of 70% that reflects the effects of self-insurance. This gap is filled by lower accumulation of liquid assets (~50%), increases in private transfers and other inflows (~10%), higher spousal labour supply (~5%), and lower net debt repayments (~5%). Mortgage borrowing and refinancing play only a small role.

Sam Cosaert, Alexandros Theloudis, Bertrand Verheyden, 28 August 2020

COVID-19 lockdowns and school closures have affected working hours and household income, with an unequal effect on women and men. The collective model of the household has hitherto ignored distinctions between private versus joint activities by parents in household time allocation. This column examines the evolving costs and benefits of togetherness, using Dutch data for 2009–2012, and speculates on how lockdown policies may affect togetherness and household welfare. Joint leisure and childcare generate a loss of flexibility in the labour market, and joint childcare prevents specialisation, generating tension between parental childcare quality and quantity.

Nicola Fuchs-Schündeln, Moritz Kuhn, Michèle Tertilt, 30 May 2020

The COVID-19 crisis has hit women’s employment particularly hard, partly because the worst-hit sectors have high female employment shares, but also because schools and daycare closures have forced more mothers to leave their jobs. This column looks at Germany, where 26% of the workforce has children aged 14 or younger, and quantifies the macroeconomic importance of working parents. If schools and daycare centres remain closed as the economy slowly reopens, 11% of workers and 8% of all working hours will be lost to the labour market. Policies to restart the economy must accommodate the concerns of these families.

Martin Halla, Julia Schmieder, Andrea Weber, 13 December 2018

For the optimal design of social insurance policy, policymakers must consider how public insurance interacts with family dynamics. This column reveals how in Austria, the impact of husbands losing their jobs on wives entering the workforce is generally weak compared to other countries. This may be explained by traditional gender norms and the importance of the male breadwinner model.


CEPR Policy Research