How to fund unemployment insurance with informality and false claims: Evidence from Senegal

• 成果类型: Article
• 署名作者: Ndiaye, Abdoulaye; Herkenhoff, Kyle; Cisse, Abdoulaye; Dell'Acqua, Alessandro; Mbaye, Ahmadou A.
• 署名单位: New York University; University of Minnesota System; University of Minnesota Twin Cities; University of California System; University of California Berkeley; University Cheikh Anta Diop Dakar
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2024.103699
• 发表日期: 2025
• 关键词: Unemployment insurance; informality; FRAUD; Development; AFRICA; taxation

摘要

This paper studies the welfare effects from the provision of unemployment insurance (UI) benefits in a context where formal workers represent only a small proportion of the labor market and informal workers can submit fraudulent claims for UI benefits. We model these features and allow for varying degrees of enforcement and different funding sources. We then estimate the model's key parameters by conducting a custom labor force survey in Senegal. Our findings show that the liquidity gains are large and the moral hazard response to the UI benefits among workers is relatively small: an extra dollar of UI benefits yields a consumption-equivalent gain of 60-90 cents, which exceeds comparable estimates from U.S. calibrations by a factor of three to sixteen. We then show that the welfare gains depend on the program design: UI funded through payroll taxes delivers the greatest welfare gains but becomes infeasible when there are few formal workers and high rates of fraudulent claims. On the other hand, UI funded through consumption taxes delivers lower welfare gains but remains feasible with high informality and false claims.