Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/251442 
Year of Publication: 
2022
Series/Report no.: 
Working Paper No. 399
Version Description: 
Revised version, February 2022
Publisher: 
University of Zurich, Department of Economics, Zurich
Abstract: 
We provide novel evidence on the impact of a child's health shock on parental labor market outcomes. To identify the causal effect, we leverage long panels of high-quality Finnish and Norwegian administrative data and exploit variation in the timing of the health shock. We do this by comparing parents across families in similar parental and child age cohorts whose children experienced a health shock at different ages. We show that these families have very similar characteristics and were following parallel trends before the event. This allows us to use a simple difference-in-differences model: we construct counterfactuals for treated households with families who experience the same shock a few years later. We find a sharp break in parents' earnings trajectories that becomes visible just after the shock. The negative effect is persistent and stronger for mothers than for fathers. We also document a substantial impact on parents' mental well-being. Our results suggest that the effect on maternal labor earnings results from the combination of the increased time needed to care for the child and the worsening of mothers' mental health.
Subjects: 
Children
health
mortality
parents
earnings
labor supply
mental health
JEL: 
I10
I12
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

Files in This Item:
File
Size
937.88 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.