Tojerow, I.

FNRS Research Credit , 2013-2014

This research project aims to answer three empirical questions which have been left unanswered by existing scientific literature: 1) how are the early career outcomes of young workers impacted by the subsidiary financial insurance provided by family during unemployment spells?, 2) more generally, does variations in the generosity of unemployment insurance impacts the average quality and types of jobs accepted by unemployed individuals, 3) is this effect only temporary or, to the contrary, does it impact the long term career outcomes of affected individuals? To answer these questions, we propose to use pseudo-random variation in family insurance created by sudden and unexpected shocks to the income of young workers’ parents as a credible source of identification for the effects we want to study. More precisely, our strategy relies on comparing individuals entering the labor market at a moment when their parent are not subject to an income shock with individuals who enter the labor market at the same time as their parents suffer a negative income shock, in the form of a prolonged sickness, a loss of a stable job or, more radically, death. To the best of our knowledge, we would be the first to study the effects of such shocks. Secondly, our study is made possible by the Belgian Social Security Crossroad Bank’s ability to match data for parents and their kids and to observe, for each of them, a large amount of information about their professional career and their use of different government benefits.