Unemployment Duration and the Interactions between Unemployment Insurance and Social Assistance
IGIER Working Paper No. 272
54 Pages Posted: 7 Dec 2004
Date Written: October 2004
Abstract
The existing studies of unemployment benefit and unemployment duration suggest that reforms that lower either the level or the duration of benefits should reduce unemployment. Despite the large number of such reforms implemented in Europe in the past decades, this paper presents evidence that shows no correlation between the reforms and the evolution of unemployment. This paper also provides an explanation for this fact by exploring the interactions between unemployment benefits and social assistance programmes. Unemployed workers who are also eligible, or expect to become eligible, for some social assistance programmes are less concerned about their benefits being reduced or terminated. They will not search particularly intensively around the time of benefit exhaustion nor will become particularly less choosy about job offers by reducing their reservation wages. Data from the European Community Household Panel (ECHP) are used to provide evidence to support this argument. Results show that, in fact, for social assistance recipients the probability of finding a job is not particularly higher during the last months of entitlement.
Keywords: Unemployment duration, unemployment insurance, social assistance
JEL Classification: J64, J65
Suggested Citation: Suggested Citation
Do you have negative results from your research you’d like to share?
Recommended Papers
-
The Spike at Benefit Exhaustion: Leaving the Unemployment System or Starting a New Job?
By David Card, Raj Chetty, ...
-
The Spike at Benefit Exhaustion: Leaving the Unemployment System or Starting a New Job?
By David Card, Raj Chetty, ...
-
Job Creation and Job Destruction in a Regulated Labour Market: The Case of Austria
By Florian Stahl, Alfred Stiglbauer, ...
-
Job Creation and Job Destruction in a Regulated Labor Market: The Case of Austria
By Alfred Stiglbauer, Florian Stahl, ...
-
Unemployment Insurance and Duration of Unemployment: Evidence from Slovenia's Transition
-
By Emilia Del Bono and Andrea Weber
-
Why is There a Spike in the Job Finding Rate at Benefit Exhaustion?
By Jan Boone and Jan C. Van Ours
-
Why is there a Spike in the Job Finding Rate at Benefit Exhaustion?
By Jan Boone and Jan C. Van Ours
-
Why is There a Spike in the Job Finding Rate at Benefit Exhaustion?
By Jan Boone and Jan C. Van Ours
-
Why is There a Spike in the Job Finding Rate at Benefit Exhaustion?
By Jan Boone and Jan C. Van Ours