The effects of widowhood on the spouse´s labor supply. Do these vary with gender?

Abstract

Losing a partner is one of the major challenges a person ever faces. Being a widow/widower in working age may force individuals to change their participation in the labor market. The most popular belief is that widowed spouses will increase their labor supply after losing their partner. However, empirical findings indicate that the assumption of a positive relationship between widowhood and labor supply is not true for every scenario, and there is little coverage of this phenomenon in the literature. To fill this gap, we present a simple model that shows how gender does affect the labor responses of the spouses to widowhood. Moreover, we focus on working-age individuals, commonly ignored in widowhood-centered studies. Our estimates provide support for the differing responses of men and women in the event of widowhood. Moreover, these responses further vary with children. Thus, gender and the type of family nucleus are of great importance when studying individuals’ response to widowhood. This study contributes to the literature by examining the labor supply response of widowed spouses of working age, focusing on gender differences. One central implication is that the pension plan in Spain might fail to adequately meet the needs of those experiencing the loss of their partner, since their labor supply responses vary greatly depending on their family situation.