Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/145051
Authors: 
Hetschko, Clemens
Schöb, Ronnie
Wolf, Tobias
Year of Publication: 
2016
Series/Report no.: 
CESifo Working Paper 6016
Abstract: 
Using specific panel data of German welfare benefit recipients, we investigate the nonpecuniary life satisfaction effects of in-work benefits. Our empirical strategy combines difference-in-difference designs with synthetic control groups to analyze 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.
Subjects: 
life satisfaction
subsidized employment
unemployment
income support
in-work benefits
social norms
JEL: 
I31
I38
J60
J68
Document Type: 
Working Paper

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