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Wage Insurance and Labor Market Trajectories

Author

Listed:
  • Benjamin G. Hyman
  • Brian K. Kovak
  • Adam Leive
  • Theodore Naff

Abstract

Wage insurance provides income support to displaced workers who find reemployment at a lower wage. We study the effects of the wage insurance provisions of the US Trade Adjustment Assistance (TAA) program using administrative data from the state of Virginia. The program includes an age-based eligibility cutoff, allowing us to compare earnings and employment trajectories for workers whose ages at the time of displacement make them eligible or ineligible for the program. Our findings suggest that wage insurance eligibility increases short-run employment probabilities and that wage insurance and TAA training may yield similar long-run effects on employment and earnings.

Suggested Citation

  • Benjamin G. Hyman & Brian K. Kovak & Adam Leive & Theodore Naff, 2021. "Wage Insurance and Labor Market Trajectories," AEA Papers and Proceedings, American Economic Association, vol. 111, pages 491-495, May.
    • Handle: RePEc:aea:apandp:v:111:y:2021:p:491-95
    DOI: 10.1257/pandp.20211093
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    Citations

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    Cited by:

    1. Donald O. Parsons, 2023. "How should job displacement wage losses be insured?," IZA World of Labor, Institute of Labor Economics (IZA), pages 446-446, July.
    2. Dorn, David & Levell, Peter, 2021. "Trade and Inequality in Europe and the US," IZA Discussion Papers 14914, Institute of Labor Economics (IZA).

    More about this item

    JEL classification:

    • J65 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment Insurance; Severance Pay; Plant Closings
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • H75 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Government: Health, Education, and Welfare
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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