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.