Does social context impact the well-being consequences of unemployment?

This thesis aims to examine the role of the social context on the psychosocial cost of unemployment in Turkey by using the Life Satisfaction Survey in 2013. Previous studies find that increasing unemployment in one's social context weakens the work norms and alleviates the burden of unemployment on individuals. In this study, we define four measurements for contextual unemployment: the province-level unemployment rates, the average percentage of unemployed in one's age & education group, and the number of unemployed in one's household. We apply multilevel regression analysis and ordered probit techniques. The results show that contextual unemployment soothes the negative impact of unemployment on the unemployed. The second major finding is that the negative impact of personal unemployment is diminished, the more unemployment is prevalent at the household level. Besides, the social norm hypothesis works especially for unemployed females in Turkey.