The effect of involuntary maternal job loss on children's behaviour and non-cognitive skills *

• Spillover effects of involuntary maternal job loss on child outcomes are addressed.
• Socio-emotional behaviour and locus of control are examined as child outcomes.
• Non-cognitive skills of pre-schoolers and adolescents are negatively affected.
• Life satisfaction mediates job loss effect on child outcomes in preschool sample.

This paper uses propensity score methods to analyse the effect of involuntary maternal job loss on children's non-cognitive skills. My analyses are based on a rich and nationwide random sample, the German Socio-Economic Panel Study (SOEP) that includes information about maternal job loss and child behaviour and non-cognitive skills, in addition to a rich conditioning set. The results show that maternal job loss increases preschool children's socio-behavioural problems and decreases adolescents' belief in self-determination.