This paper tests for the importance of non-pecuniary costs of unemployment using a longitudinal data-set on life-satisfaction of working-age men in Germany. We show that unemployment has a large detrimental effect on satisfaction after individual specific fixed effects are controlled for. The non-pecuniary effect is much larger than the effect that stems from the associated loss of income.
In:
Economica
65 (1998), 257, 1-15
| Liliana Winkelmann, Rainer Winkelmann