The Transferable Scars: A Longitudinal Evidence of Psychological Impact of Past Parental Unemployment on Adolescents in the United Kingdom

CEP Discussion Paper No 1165 by Nattavudh Powdthavee and James Vernoit (Centre for Economic Performance, London School of Economics) published September 2012

Abstract

Using a longitudinal data of British youths, this paper explores the consequences of past parental unemployment on the current happiness and self-esteem of the children.

We find that a past unemployment spell of the father has important consequences for their children and leads to them having both lower subjective well-being and self-confidence.

In addition, this paper also presents evidence that both subjective well-being and self-confidence responds differently to maternal unemployment compared to paternal unemployment.

In our final table, we show changes in adolescents’ well-being and self-esteem predicts educational attainments at 16. Together these findings offer new evidence of unemployment scarring on children’s livelihood.

JEL Classifications: D1, I3, J6

Full text (PDF 43pp)

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