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What Have We Learned from the Illinois Reemployment Bonus Experiment?

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Author Info
Meyer, Bruce D

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Abstract

This article analyzes an experimental program that offered payments to unemployment insurance recipients who found a job quickly. The experiment provided exogenous differences in individual incentives, which the author uses to test labor supply and search theories of unemployment. He examines predictions about the timing of exits from unemployment and the effect of the fixed-amount bonus on different wage level groups. The author also argues that the experimental evidence does not show the desirability of a permanent program. A permanent program would sharply increase the compensation for short unemployment insurance spells, likely increasing the claims rate and possibly increasing unemployment. Copyright 1996 by University of Chicago Press.

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Publisher Info
Article provided by University of Chicago Press in its journal Journal of Labor Economics.

Volume (Year): 14 (1996)
Issue (Month): 1 (January)
Pages: 26-51
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Handle: RePEc:ucp:jlabec:v:14:y:1996:i:1:p:26-51

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  1. Christopher J. O'Leary & Paul Decker & Stephen A. Wandner, 1997. "Reemployment Bonuses and Profiling," Staff Working Papers 98-51, W.E. Upjohn Institute for Employment Research. [Downloadable!] (restricted)
  2. Pieter A. Gautier & José Luis Moraga-González & Ronald P. Wolthoff, 2007. "Structural Estimation of Search Intensity: Do Non-Employed Workers Search Enough?," Tinbergen Institute Discussion Papers 07-071/3, Tinbergen Institute. [Downloadable!]
    Other versions:
  3. Jaap Abbring & James Heckman, 2008. "Dynamic policy analysis," CeMMAP working papers CWP05/08, Centre for Microdata Methods and Practice, Institute for Fiscal Studies. [Downloadable!]
  4. Adriana D. Kugler, 1997. "Employee Referrals and the Inter-industry Wage Structure," Economics Working Papers 252, Department of Economics and Business, Universitat Pompeu Fabra. [Downloadable!]
  5. Schunk, Daniel, 2003. "The Pennsylvania Reemployment Bonus Experiments: How a survival model helps in the analysis of the data," Sonderforschungsbereich 504 Publications 03-35, Sonderforschungsbereich 504, Universität Mannheim & Sonderforschungsbereich 504, University of Mannheim. [Downloadable!]
  6. Yannis Bilias, 2000. "Sequential testing of duration data: the case of the Pennsylvania 'reemployment bonus' experiment," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 15(6), pages 575-594. [Downloadable!]
  7. G.E. Bijwaard, 2002. "Instrumental Variable Estimation for Duration Data: A Reappraisal of the Illinois Reemployment Bonus Experiment," Econometrics 0204001, EconWPA. [Downloadable!]
  8. Govert E. Bijwaard, 2008. "Instrumental Variable Estimation for Duration Data," Tinbergen Institute Discussion Papers 08-032/4, Tinbergen Institute. [Downloadable!]
    Other versions:
  9. Govert E. Bijwaard, 2007. "Instrumental Variable Estimation of Treatment Effects for Duration Outcomes," IZA Discussion Papers 2896, Institute for the Study of Labor (IZA). [Downloadable!]
  10. Hans H. Glismann & Klaus Schrader, 2001. "Alternative Systeme der Arbeitslosenversicherung — Das Beispiel der Vereinigten Staaten und des Vereinigten Königreichs," Kiel Working Papers 1032, Kiel Institute for the World Economy. [Downloadable!]
  11. Jaap Abbring & Gerard van den Berg, 2005. "Social experiments and instrumental variables with duration outcomes," IFS Working Papers W05/19, Institute for Fiscal Studies. [Downloadable!]
    Other versions:
  12. Jeffrey Zabel & Saul Schwartz & Stephen Donald, 2006. "An Econometric Analysis of the Impact of the Self-Sufficiency Project on the Employment Behaviour of Former Welfare Recipients," IZA Discussion Papers 2122, Institute for the Study of Labor (IZA). [Downloadable!]
  13. Govert Bijwaard & Geert Ridder, 1998. "Correcting for Selective Compliance in a Re-employment Bonus Experiment," Tinbergen Institute Discussion Papers 98-096/4, Tinbergen Institute. [Downloadable!]
    Other versions:
  14. Rodriguez-Planas, Nuria, 2004. "Re-Employment Bonuses in a Signalling Model of Temporary Layoffs," IZA Discussion Papers 1010, Institute for the Study of Labor (IZA). [Downloadable!]
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