The Labour-force Participation of the Wives of Unemployed Men: Comparing Britain and West Germany Using Longitudinal Data.

The article compares the labor-force transitions of the wives of unemployed and employed men in Great Britain and West Germany. In Germany, when a man becomes unemployed, his wife is mote likely to enter employment, than when he was employed. In Britain, when a man becomes unemployed, his wife is less likely to enter employment than if he were employed, in particular she is less likely to enter part-time employment. Both of these mechanisms come into effect when the husband has been unemployed for 13 months or more and is normally receiving means-tested benefit. The wives of unemployed men have, on average, spent less of their post-education life in the labour market, and this affects their propensity to enter employment. However, one finds an effect of husband's current labour-force status, i.e. unemployment, even after controlling for this. While there may be some effect of the wife being a reluctant breadwinner, there is no reason to suspect that this effect would be much larger in Britain than in Germany. Instead, there is a strong suspicion that there is a disincentive effect of means-tested benefit in Great Britain, which partly explains why the wives of unemployed men are less likely to enter employment than others.