Job Insecurity, Debt Burdens and Individual Health

32 Pages Posted: 14 Oct 2019

See all articles by Maite Blázquez Cuesta

Maite Blázquez Cuesta

Universidade da Madeira

Santiago Budría

Universidade da Madeira

Ana I. Moro‐Egido

University of Granada

Abstract

Job insecurity exerts negative effects on self-reported health. Using the Spanish Survey of Household Finances for 2011-2014, this paper asks whether and to what extent debt burdens enhance these detrimental health effects. To address potential endogeneity problems surrounding this question, the paper adopts Deb and Trivedi's (2006) econometric approach. The results show that the negative effect of job insecurity on self-assessed health is exacerbated if the individual is over-indebted. Moreover, the role of over-indebtedness differs between types of debt, with nonmortgage debts causing larger health losses than mortgage debts. Specifically, the results suggest that being over-indebted with non-mortgage debts boosts the negative impact of job insecurity by a factor of three. Thus, concerns about job insecurity should not be decoupled from concerns about increasing household indebtedness, and policy measures intended to improve individual welfare should consider both phenomena together.

Keywords: self-assessed health, job insecurity, debt burdens

JEL Classification: G01, I14, I22

Suggested Citation

Blázquez Cuesta, Maite and Budria, Santiago and Moro‐Egido, Ana I., Job Insecurity, Debt Burdens and Individual Health. IZA Discussion Paper No. 12663. Available at SSRN: https://ssrn.com/abstract=3468611

Maite Blázquez Cuesta (Contact Author)

Universidade da Madeira ( email )

Campus Universitario da Penteada
9000-390 Funchal
United States

Santiago Budria

Universidade da Madeira ( email )

Campus Universitario da Penteada
9000-390 Funchal
Portugal

Ana I. Moro‐Egido

University of Granada

C/Rector López Argueta S/N
Granada, 18071
Spain

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