Almost Famous: How Wealth Shocks Impact Career Choices

56 Pages Posted: 16 Dec 2019 Last revised: 3 Feb 2020

See all articles by Jacelly Cespedes

Jacelly Cespedes

University of Minnesota - Carlson School of Management

Zack Liu

University of Houston - Department of Finance

Carlos Parra

Pontifical Catholic University of Chile - School of Business

Date Written: December 1, 2019

Abstract

We study the short and long-term career effects of shocks to household balance sheets using a novel dataset of workers in the film industry in the wake of the Great Recession. We find that individuals within the same county and occupation who lost more housing wealth reduce their participation in films with other high-profile talents (individuals that have won prestigious awards), films that are positively rated, and films that are likely to win awards, but they increase involvement in small productions. We control for local labor demand shocks by comparing homeowners to renters. These wealth losses also have adverse long-term consequences on the probability of leading roles, individuals' popularity, and film quality. Overall, our results suggest that wealth shocks distort non-salaried workers' labor decisions due to liquidity concerns and impact individuals' career paths.

Keywords: Career Choices, Job Search, Employer/Employee Matching, Long-term Effects, Wealth Shocks, Household Finance, Labor Economics, Real Estate

Suggested Citation

Cespedes, Jacelly and Liu, Zack and Parra, Carlos, Almost Famous: How Wealth Shocks Impact Career Choices (December 1, 2019). Available at SSRN: https://ssrn.com/abstract=3491426 or http://dx.doi.org/10.2139/ssrn.3491426

Jacelly Cespedes

University of Minnesota - Carlson School of Management ( email )

19th Avenue South
Minneapolis, MN 55455
United States

HOME PAGE: http://sites.google.com/site/jacellycespedes/

Zack Liu (Contact Author)

University of Houston - Department of Finance ( email )

Houston, TX 77204
United States

Carlos Parra

Pontifical Catholic University of Chile - School of Business ( email )

Vicuna Mackenna 4860
Santiago
Chile

HOME PAGE: http://www.carlosrparra.com/

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