Caterina Giannetti|Marianna Madia|Luigi Moretti
Job insecurity and financial distress
University of Padua|University of Padua
abstractthis article investigates effects different job categories households likelihood experiencing financial distress given imperfect financial markets absence unemployment subsidies households less secure jobs likely experience drops income frequently households wellprotected jobs households abilities deal financial decisions ie financial literacy mitigate problems results suggest respect stable workers greater job uncertainty insecure workers increases probability financial distress similarly working statuses eg unemployment cases even ie parttime workers however high level financial literacy counterbalance effect especially atypical workerskeywords personal financedebtfinancial distressjob insecurityjel classification c23c25d14 notes1 key reforms include 1997 treu measures law 1971997 biagi reform 2003 law 302003 aimed improving labour market flexibility treu measures named labour minister tiziano treu first legislative measures aimed increasing flexibility via labour market reform margin primarily introducing temporary contracts providing incentives parttime work another law passed year law 4691997 concerning privatization decentralization job centres abolished principle public monopoly employment services biagi reform named late marco biagi advisor 20012006 berlusconi government deregulated use atypical work arrangements temporary agency work staffleasing parttime work introduced new forms atypical work arrangements oncall jobs lavoro intermittente job sharing occasional work lavoro progetto2 detailed description see labour market section especially table 92in 2008 annual report bank italy citation20083 substantial differences however emerge use unbalanced panel results available upon request4 questions eg labour outcomes surveys also cover family members addition household heads allowing us compute indicators family levels5 consider category selfemployed workers mainly working shareholders category substantially different previous job categories6 parttime jobs frequently lesser quality similar fulltime jobs terms conditions employment hourly wages non wage benefits social protection coverage even training career development opportunities see example messenger citation20107 precise wording three questions follows1imagine receive statement bank tell sum money available end may amount euros dont know2imagine leaving 1000 current account pays 2 annual interest charges imagine also inflation running 2 think withdraw money years time able buy amount goods spent 1000 today yes able buy less able buy know3which following types mortgage think would allow start fix maximum amount number installments paid debt extinguished floatingrate mortgage fixedrate mortgage floatingrate mortgage fixed installments know8 regressions also used indicator financial literacy number correct answers two questions appearing waves although direction coefficient analogous variable never turned significant reason indicator theoretically assume three values 012 reality percentage provide correct answer small thus much variation across time two questions contrary minmax indicator advantage considering entire set questions asked surveys standardizes total number questions asked9 experiments confirm behavioural validity kind measure see example dohmen et al citation201110 checked robustness results also controlling type debt separately results change11 robustness check square age included analyses performed ultimately significant12 alternative complementary explanation relates behavioural traits workers employment statuses example workers insecure jobs might impatient unemployed individuals unfortunately discussed data research needed fully disentangle behavioural effects13 check robustness results inclusion additional nonlinearity include square education among regressors results substantially identical14 sample correlation education atypical workers equal 005 whereas equal 007 insecure workers15 stata corresponds ogologit2 command developed williams200616 also recalled analysis panel sample reduced one third 2006 observations lost17 particular proxy live today organized impatience means following questions analyses robustness often check balance current account least week least fortnight less month never dont know following options best describes actions receive bank statement check receipts statement check amounts credited debited statement reasonable check balance dont read dont receive statement dont know imagine find following situation lottery receive sum equal households net yearly revenue receive money years time however give part sum collect rest win immediately obtain money immediately would give 20 win yes 10 yes 5 yes 2 yes no18 regard two strands research socialcognitive theorists trait theorists first group theorists feature investments social interactions direct determinants traits assumed evolve function experiences agents whereas latter group theorists consider possibility instead emphasize selflearning traits evolve fixed biological principles unrelated experiences individuals almlund et al citation2011