Unemployment insurance in a three-state model of the labor market

• 成果类型: Article
• 署名作者: Popp, Aaron
• 署名单位: California State University System; California State University Fullerton
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2017.07.005
• 发表日期: 2017
• 页码: 142-157
• 关键词: Unemployment insurance; heterogeneous agents; Welfare effect

摘要

The paper extends the model of Krusell etal. (2010) to study the welfare effects of unemployment insurance. The model unemployment insurance program includes four realistic features: 1) a 50% replacement rate up to a benefit cap; 2) finite duration of eligibility during a jobless spell; 3) limited eligibility; and 4) and an imperfectly monitored job search requirement. The model is parameterized to fit the size of scope of unemployment insurance in the United States. Removing unemployment insurance from the model leads to only a 0.1% consumption equivalent increase in average welfare. Simplifying assumptions about the structure of unemployment insurance, such as allowing all job losers to receive benefits, lead to much larger welfare effects similar to the effects found in the past literature. Understanding the welfare effects of unemployment insurance requires careful modeling of the structure of the program. (C) 2017 Elsevier B.V. All rights reserved.