Unemployment,Splitting up,and Spousal Income Replacement

Abstract. In this study, the consequences of unemployment for a Swedish sample of couples are analysed. The purpose is to estimate the possible income replacement that a female/male spouse can provide. Unemployment can also affect the probability that the couples split up. As not all couples remain in the analysis, a potential selection problem can occur. To deal with this problem, and also to handle unobserved heterogeneity, a sample selection model for panel data is estimated. Unemployment is not found to be correlated with a higher spousal income.