Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/168449
Authors: 
Chadi, Adrian
Hetschko, Clemens
Year of Publication: 
2017
Series/Report no.: 
SOEPpapers on Multidisciplinary Panel Data Research 925
Abstract: 
We study the usually assumed trade-off between income and leisure in labor supply decisions using comprehensive German panel data. We compare non-employed individuals after plant closures with employed people regarding both income and time use as well as their subjective perceptions of these two factors. We find that the gain of non-working time translates into higher satisfaction with free time, while time spent on hobbies increases to a lesser extent than home production. Additionally, satisfaction with family life increases, which may be a hidden benefit of being unemployed. In contrast, satisfaction with income strongly declines when becoming jobless. Identity utility from earning a living may play the role of a hidden benefit of employment. Finally, we examine subjective assessments of income and leisure as potential predictors for job take-up. Non-employed people are particularly likely to take up a job soon when they are dissatisfied withtheir income.
Subjects: 
labor supply
plant closure
leisure
work-family conflict
life satisfaction
income satisfaction
free time satisfaction
family satisfaction
JEL: 
D01
D13
I31
J22
J64
J65
Document Type: 
Working Paper

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