This file is part of IDEAS, which uses RePEc data


[ Papers | Articles | Software | Books | Chapters | Authors | Institutions | JEL Classification | NEP reports | Search | New papers by email | Author registration | Rankings | Volunteers | FAQ | Blog | Help! ]

On the Extent of Re-Entitlement Effects in Unemployment Compensation

Author info | Abstract | Publisher info | Download info | Related research | Statistics
Author Info
Javier Ortega
Laurence Rioux

Additional information is available for the following registered author(s):

Abstract

A dynamic labor matching economy is presented, in which the unemployed are either entitled tounemployment insurance (UI) or unemployment assistance (UA), and the employees are eithereligible for UI or UA upon future separations. Eligibility for UI requires a minimum duration ofcontributions and UI benefits are then paid for a limited duration. Workers are risk-averse and wagesare determined in a bilateral Nash bargain. As eligibility for UI does not automatically follow fromemployment, the two types of unemployed workers have different threat points, which deliversequilibrium wage dispersion. Most of the variables and parameters of the model are estimated usingthe French sample of the European Community Household Panel (1994-2000). We show thatextending the UI entitlement improves the situation of all groups of workers and slightly lowersunemployment, while raising UI benefits harms the unemployed on assistance and raisesunemployment. Easier eligibility fo r UI also improves the situation of all groups of workers andfavors relatively more the least well-off than longer entitlement. The re-entitlement effect in Francelowers by 10% the rise in the wage and by 13% the rise in unemployment following a 10% increase inbenefit levels.

Download Info
To download:

If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. In case of further problems read the IDEAS help file. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://cep.lse.ac.uk/pubs/download/dp0846.pdf
File Format: application/pdf
File Function:
Download Restriction: no

Publisher Info
Paper provided by Centre for Economic Performance, LSE in its series CEP Discussion Papers with number dp0846.

Download reference. The following formats are available: HTML, plain text, BibTeX, RIS (EndNote), ReDIF
Length:
Date of creation: Jan 2008
Date of revision:
Handle: RePEc:cep:cepdps:dp0846

Contact details of provider:
Web page: http://cep.lse.ac.uk/pubs/

For technical questions regarding this item, or to correct its listing, contact: ().

Related research
Keywords: re-entitlement effects unemployment compensation matching

Other versions of this item:

Find related papers by JEL classification:
J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts
J65 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Unemployment Insurance; Severance Pay; Plant Closings

This paper has been announced in the following NEP Reports:

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Pavoni, Nicola, 2007. "On optimal unemployment compensation," Journal of Monetary Economics, Elsevier, vol. 54(6), pages 1612-1630, September. [Downloadable!] (restricted)
  2. Cahuc, Pierre & Malherbet, Franck, 2004. "Unemployment compensation finance and labor market rigidity," Journal of Public Economics, Elsevier, vol. 88(3-4), pages 481-501, March. [Downloadable!] (restricted)
    Other versions:
  3. Michele Pellizzari, . "Unemployment Duration and the Interactions Between Unemployment Insurance and Social Assistance," Working Papers 272, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University. [Downloadable!]
    Other versions:
  4. Wadsworth, J., 1989. "Unemployment Benefits And Search Effort In The Uk Labour Market," Papers 333, London School of Economics - Centre for Labour Economics.
    Other versions:
  5. Jones, Stephen R G, 1989. "Job Research Methods, Intensity and Effects," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 51(3), pages 277-96, August.
  6. Fredriksson, Peter & Holmlund, Bertil, 2001. "Optimal Unemployment Insurance in Search Equilibrium," Journal of Labor Economics, University of Chicago Press, vol. 19(2), pages 370-99, April. [Downloadable!] (restricted)
    Other versions:
  7. Melvyn Coles & Adrian Masters, 2004. "Duration-Dependent Unemployment Insurance Payments and Equilibrium Unemployment," Economica, London School of Economics and Political Science, vol. 71, pages 83-97, 02. [Downloadable!] (restricted)
  8. Dale T. Mortensen, 1977. "Unemployment Insurance and Labor Supply Decisions," Discussion Papers 271, Northwestern University, Center for Mathematical Studies in Economics and Management Science. [Downloadable!]
  9. Adrian Masters & Melvyn Coles, 2004. "Optimal Unemployment Insurance in a Matching Equilibrium," Discussion Papers 04-12, University at Albany, SUNY, Department of Economics. [Downloadable!]
    Other versions:
  10. James Albrecht & Susan Vroman, 2005. "Equilibrium Search With Time-Varying Unemployment Benefits," Economic Journal, Royal Economic Society, vol. 115(505), pages 631-648, 07. [Downloadable!] (restricted)
    Other versions:
  11. Hosios, Arthur J, 1990. "On the Efficiency of Matching and Related Models of Search and Unemployment," Review of Economic Studies, Blackwell Publishing, vol. 57(2), pages 279-98, April. [Downloadable!] (restricted)
  12. Schmitt, John & Wadsworth, Jonathan, 1993. "Unemployment Benefit Levels and Search Activity," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 55(1), pages 1-24, February.
  13. Cahuc, Pierre & Lehmann, Etienne, 2000. "Should unemployment benefits decrease with the unemployment spell?," Journal of Public Economics, Elsevier, vol. 77(1), pages 135-153, July. [Downloadable!] (restricted)
  14. Wang, Cheng & Williamson, Stephen D., 2002. "Moral Hazard, Optimal Unemployment Insurance and Experience Rating," Staff General Research Papers 10133, Iowa State University, Department of Economics.
    Other versions:
  15. Hopenhayn, Hugo A & Nicolini, Juan Pablo, 1997. "Optimal Unemployment Insurance," Journal of Political Economy, University of Chicago Press, vol. 105(2), pages 412-38, April.
    Other versions:
Full references

Statistics
Access and download statistics

Did you know? All bibliographic data on IDEAS has been put in the public domain by the publishers.

This page was last updated on 2008-8-19.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.