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Problems of sample construction in studies of the effects of unemployment insurance on unemployment duration

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  • Pedro Portugal
  • John T. Addison

Abstract

Conventional analyses of the effect of unemployment insurance (UI) on unemployment duration have neglected the issue of sample construction. The authors show that such studies, by failing to account for job finding among those eligible for UI within intervals corresponding to the waiting time and filing delays associated with drawing benefits, overstate the expected unemployment duration of UI recipients while understating that of nonrecipients; ignore a dominant line of causation running from duration to UI benefit status; produce misspecified hazard functions; and may overstate by as much as 50% the effect of the UI replacement rate on jobless duration. (Abstract courtesy JSTOR.)

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Bibliographic Info

Article provided by ILR Review, Cornell University, ILR School in its journal ILR Review.

Volume (Year): 43 (1990)
Issue (Month): 4 (April)
Pages: 463-477

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Handle: RePEc:ilr:articl:v:43:y:1990:i:4:p:463-477

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Cited by:
  1. Addison, John T. & Portugal, Pedro, 2004. "How does the unemployment insurance system shape the time profile of jobless duration?," Economics Letters, Elsevier, vol. 85(2), pages 229-234, November.
  2. Addison, John T. & Blackburn, McKinley L., 2000. "The effects of unemployment insurance on postunemployment earnings," Labour Economics, Elsevier, vol. 7(1), pages 21-53, January.
  3. Mário Centeno, 2002. "The Match Quality Gains from Unemployment Insurance," Working Papers w200209, Banco de Portugal, Economics and Research Department.
  4. Karen E. Needels & Walter Nicholson, 1999. "An Analysis of Unemployment Insurance Durations Since the 1990-1992 Recession," Mathematica Policy Research Reports 2823, Mathematica Policy Research.
  5. Partridge, Mark D. & Rickman, Dan S., 1998. "Regional differences in chronic long-term unemployment," The Quarterly Review of Economics and Finance, Elsevier, vol. 38(2), pages 193-215.

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