A Menu of Insurance Contracts for the Unemployed

• 成果类型: Article
• 署名作者: Barnichon, Regis; Zylberberg, Yanos
• 署名单位: Centre for Economic Policy Research - UK; University of Bristol; Leibniz Association; Ifo Institut; Alan Turing Institute
• 刊物名称: REVIEW OF ECONOMIC STUDIES
• ISSN/ISSBN: 0034-6527
• DOI: 10.1093/restud/rdab026
• 发表日期: 2022
• 页码: 118-141
• 关键词: Adverse selection; job search; Reservation wages; optimal level; moral hazard; duration; benefits; SANCTIONS; savings; recall

摘要

Unemployment insurance (UI) programs traditionally take the form of a single insurance contract offered to job seekers. In this work, we show that offering a menu of contracts can be welfare improving in the presence of adverse selection and moral hazard. When insurance contracts are composed of (1) a UI payment and (2) a severance payment paid at the onset of unemployment, offering contracts with different ratios of UI benefits to severance payment is optimal under the equivalent of a single-crossing condition: job seekers in higher need of unemployment insurance should be less prone to moral hazard. In that setting, a menu allows the planner to attract job seekers with a high need for insurance in a contract with generous UI benefits, and to attract job seekers most prone to moral hazard in a separate contract with a large severance payment but little unemployment insurance. We propose a simple sufficient statistics approach to test the single-crossing condition in the data.