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Unemployment Insurance and Job Turnover in Spain

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  • Yolanda Rebollo Sanz

    ()
    (Department of Economics, Universidad Pablo de Olavide)

Abstract

The aim of this paper is to shed some light on the potential relationships between the unemployment insurance system and labour market turnover, seeking to further the traditional view that this system has only behavioural consequences for the labour supply side of the labour market. This study assumes the incentives embedded in the unemployment insurance system have a heterogeneous impact, depending on the type of labour market transition (quits versus layoffs and recalls versus new job entrances) and on a worker’s attachment to the labour market (gender and type of contract). The layoff hazard rate increases as workers qualify for unemployment benefits, while the quit hazard rate remains stable. Similarly, employment inflow increases sharply after the exhaustion of unemployment benefits. The timing and importance of the exit differs between recalls and new job entry and depends on a worker’s attachment to the labour market. The results show that unemployment benefits appear to favour job turnover and both firms’ and workers´ decisions seem to matter.

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Bibliographic Info

Paper provided by Universidad Pablo de Olavide, Department of Economics in its series Working Papers with number 10.08.

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Length: 55 pages
Date of creation: Oct 2010
Date of revision: Nov 2011
Handle: RePEc:pab:wpaper:10.08

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Keywords: Unemployment Insurance; Job Turnover; Multivariate Mix Proportional Hazard Models; Recall and Layoffs; Employment and Unemployment Duration;

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Citations

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Cited by:
  1. Raquel Carrasco & J. Ignacio García Pérez, 2012. "Economic Conditions and Employment Dynamics of Immigrants versus Natives: Who Pays the Costs of the "Great Recession"?," Economics Working Papers we1232, Universidad Carlos III, Departamento de Economía.
  2. Vodopivec, Milan, 2009. "Introducing unemployment insurance to developing countries," Social Protection Discussion Papers 49170, The World Bank.
  3. Simoes, Nadia, 2013. "Subsídio de desemprego: uma revisão da literatura teórica e empírica
    [Unemployment insurance: a survey]
    ," MPRA Paper 52332, University Library of Munich, Germany.
  4. Nagore García, Amparo & van Soest, Arthur, 2014. "Unemployment Transitions to Stable and Unstable Jobs Before and During the Crisis," IZA Discussion Papers 8121, Institute for the Study of Labor (IZA).
  5. Tatsiramos, K. & Ours, J.C. van, 2012. "Labor Market Effects of Unemployment Insurance Design," Discussion Paper, Tilburg University, Center for Economic Research 2012-082, Tilburg University, Center for Economic Research.

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