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The Impact of Long-Run Macroeconomic Experiences on Personality

SAFE Working Paper No. 142

31 Pages Posted: 8 Sep 2016  

Nathanael Vellekoop

Goethe University Frankfurt; Goethe University Frankfurt - Research Center SAFE; Netspar

Date Written: August 31, 2016

Abstract

Using two datasets containing demographically representative samples of the Dutch population, I study how lifetime experiences of aggregate labor market conditions affect personality. Three sets of findings are reported. First, experienced aggregate unemployment is negatively correlated with the levels of all Big Five personality traits, except for conscientiousness (no significant correlation). Second, in panel data models with individual fixed effects I find that changes in experienced aggregate unemployment cause changes in emotional stability and agreeableness for men, and conscientiousness for women. The correlation is positive, and effects are economically large. Thirdly, I report suggestive evidence that the main driver is experienced aggregate unemployment, instead of other macroeconomic variables as experienced GDP, stock market returns or inflation. Taken together, these findings suggest that changes in Big Five personality traits are systematically related to experienced aggregate labor market conditions.

Keywords: Personality traits, Big Five, Locus of control, labor market, unemployment

JEL Classification: D01, D12, E23, E32

Suggested Citation

Vellekoop, Nathanael, The Impact of Long-Run Macroeconomic Experiences on Personality (August 31, 2016). SAFE Working Paper No. 142. Available at SSRN: https://ssrn.com/abstract=2835432 or http://dx.doi.org/10.2139/ssrn.2835432

Nathanael Vellekoop (Contact Author)

Goethe University Frankfurt ( email )

Theodor-W.-Adorno-Platz 3
Frankfurt am Main, 60323
Germany

HOME PAGE: http://www.nvellekoop.nl

Goethe University Frankfurt - Research Center SAFE ( email )

(http://www.safe-frankfurt.de)
Theodor-W.-Adorno-Platz 3
Frankfurt am Main, 60323
Germany

Netspar ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands

HOME PAGE: http://www.nvellekoop.nl

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