, Volume 10, Issue 4, pp 421-430
Date: 09 Apr 2008

Unemployment, Social Capital, and Subjective Well-Being

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It has been shown in past research that unemployment has a large negative impact on subjective well-being of individuals. In this paper, I explore whether and to what extent people with more social capital are sheltered from the harmful effects of unemployment. Using data from the German Socio-Economic Panel 1984–2004, I find that social capital is an important predictor of well-being levels, but there is no evidence that it moderates the effect of unemployment on well-being. Possible reasons for these findings are discussed, and suggestions for future research given.

This paper was written while I was visiting scholar at the W.E. Upjohn Institute for Employment Research in Kalamazoo, MI. I am grateful to the Institute for its hospitality, to Andrew Clark, Andrew Oswald and three anonymous referees for valuable comments, and to the German Socio Economic Panel Study (GSOEP) at the German Institute for Economic Research (DIW), Berlin, for providing the data.