Late-career unemployment and cognitive abilities

TitleLate-career unemployment and cognitive abilities
Publication TypeJournal Article
Year of Publication2022
AuthorsFreise, D, Schmitz, H, Westphal, M
JournalJournal of Health Economics
ISSN Number0167-6296
KeywordsCognitive abilities, Event studies, Mental Health, Plant closures, Unemployment

We study the effect of unemployment on cognitive abilities among individuals aged between 50 and 65 in Europe. To this end, we exploit plant closures and use flexible event-study estimations together with an experimentally elicited measure of fluid intelligence, namely word recall. We find that, within a time period of around eight years after the event of unemployment, cognitive abilities only deteriorate marginally – the effects are insignificant both in statistical and economic terms. We do, however, find significant effects of late-career unemployment on the likelihood to leave the labor force, and short-term effects on mental health problems such as depression and sleep problems.

Citation KeyFREISE2022102689
PubMed ID36228385