What happens to kids’ school performanceÂ if their parent becomes unemployed? According to a new study from Norway, the answer depends on whether it’s mum or dad. They use plant closings rather than all job losses, since economists generally think that having your firm shut down is more exogenous (ie. more like a random shock) than being fired.
Parental Job Loss and Childrenâ€™s School Performance
Mari Rege, Kjetil Telle and Mark Votruba
Using Norwegian register data we estimate how childrenâ€™s school performance is affected by their parentsâ€™ exposure to plant closure. Fathersâ€™ exposure leads to a substantial decline in childrenâ€™s graduation-year grade point average, but only in municipalities with mediocre-performing job markets. The negative effect does not appear to be driven by a reduction in fatherâ€™s income and employment, an increase in parental divorce, or the trauma of relocating. In contrast, mothersâ€™ exposure leads to improved school performance. Our findings appear to be consistent with sociological â€œrole theories,â€ with parents unable to fully shield their children from the stress caused by threats to the fatherâ€™s traditional role as breadwinner, and mothers responding to job loss by allocating greater attention towards child rearing.
One thing I love about these Scandinavian studies is the data. None of these namby-pambyÂ 1-in-100 samples for them.Â
Our analysis utilizes a comprehensive, longitudinal register database containing annual records for every person in Norway (FD-trygd), in addition to a database containing the school grades of all graduating secondary students in Norway from 2003 to 2005. Importantly, the two databases contain personal identifiers allowing us to link each childâ€™s educational outcomes to the parentsâ€™ records. This provides us with a unique opportunity to investigate the causal effect of parental job loss on a childâ€™s school performance.