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Intergenerational Influences on the Receipt of Unemployment Insurance in Canada and Sweden

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  • Bjorn, Gustafsson
  • Gustafsson, Bjorn
  • Osterberg, Torun
  • Corak, Miles

Abstract

The objective of this paper is to examine the extent to which an individual's use of unemployment insurance (UI) as a young adult is influenced by past experience with the program, and by having had a parent who also collected UI. A major methodological challenge is to determine the extent to which the intergenerational correlation of UI status is "spurious" or causal. Both the time to a first UI claim and the entire sequence of claims over an extended period are examined using two alternative ways of controlling for unobserved heterogeneity. The analysis is based upon longitudinal data on a cohort of young Canadian and Swedish men. It is found that parental use of UI shortens the time to a first UI claim in Canada, but not in Sweden. Subsequent participation in the Canadian program is influenced by parental UI history. In Sweden individual learning through past participation in UI - not family background - is the dominant avenue determining repeated participation.

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Bibliographic Info

Paper provided by Statistics Canada, Analytical Studies Branch in its series Analytical Studies Branch Research Paper Series with number 2001159e.

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Date of creation: 12 Jan 2001
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Handle: RePEc:stc:stcp3e:2001159e

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Web page: http://www.statcan.gc.ca
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Related research

Keywords: Employment insurance; social assistance and other transfers; Families; households and housing; Family history; Labour;

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References

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  1. Miles Corak, 1993. "Is unemployment insurance addictive? Evidence from the benefit durations of repeat users," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 47(1), pages 62-72, October.
  2. Donal O'Neill; & Olive Sweetman, 1997. "Intergenerational Mobility in Britain: Evidence from unemployment patterns," Economics, Finance and Accounting Department Working Paper Series n730997, Department of Economics, Finance and Accounting, National University of Ireland - Maynooth.
  3. Lars Ljungqvist & Thomas J. Sargent, 1996. "The European Unemployment Dilemma," EUI-RSCAS Working Papers 36, European University Institute (EUI), Robert Schuman Centre of Advanced Studies (RSCAS).
  4. Thomas Lemieux & W. Bentley MacLeod, 1998. "Supply Side Hysterisis: The Case of the Canadian Unemployment InsuranceSystem," NBER Working Papers 6732, National Bureau of Economic Research, Inc.
  5. Jenkins, Stephen P, 1995. "Easy Estimation Methods for Discrete-Time Duration Models," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 57(1), pages 129-38, February.
  6. Fudenberg, Drew & Ellison, Glenn, 1995. "Word-of-Mouth Communication and Social Learning," Scholarly Articles 3196300, Harvard University Department of Economics.
  7. Lindbeck, Assar, 1995. "Hazardous Welfare-State Dynamics," Working Paper Series 428, Research Institute of Industrial Economics.
  8. Ellison, Glenn & Fudenberg, Drew, 1993. "Rules of Thumb for Social Learning," Scholarly Articles 3196332, Harvard University Department of Economics.
  9. Bruce D. Meyer & Dan T. Rosenbaum, . "Repeat Use of Unemployment Insurance," IPR working papers 95-24, Institute for Policy Resarch at Northwestern University.
  10. Moffitt, Robert, 1983. "An Economic Model of Welfare Stigma," American Economic Review, American Economic Association, vol. 73(5), pages 1023-35, December.
  11. Sara McLanahan, 1988. "Family structure and dependency: Early transitions to female household headship," Demography, Springer, vol. 25(1), pages 1-16, February.
  12. Thomas Dunn & Douglas Holtz-Eakin, 1996. "Financial Capital, Human Capital, and the Transition to Self-Employment:Evidence from Intergenerational Links," NBER Working Papers 5622, National Bureau of Economic Research, Inc.
  13. Björklund, Anders & Holmlund, Bertil, 1986. "The Economics of Unemployment Insurance: The Case of Sweden," Working Paper Series 167, Research Institute of Industrial Economics.
  14. Gottschalk, Peter, 1996. "Is the correlation in welfare participation across generations spurious?," Journal of Public Economics, Elsevier, vol. 63(1), pages 1-25, December.
  15. Miles Corak & Andrew Heisz, 1999. "The Intergenerational Earnings and Income Mobility of Canadian Men: Evidence from Longitudinal Income Tax Data," Journal of Human Resources, University of Wisconsin Press, vol. 34(3), pages 504-533.
  16. Antel, John J, 1992. "The Intergenerational Transfer of Welfare Dependency: Some Statistical Evidence," The Review of Economics and Statistics, MIT Press, vol. 74(3), pages 467-73, August.
  17. Atkinson, Anthony B & Micklewright, John, 1991. "Unemployment Compensation and Labor Market Transitions: A Critical Review," Journal of Economic Literature, American Economic Association, vol. 29(4), pages 1679-1727, December.
  18. Lindbeck, Assar, 1995. "Hazardous Welfare-State Dynamics," American Economic Review, American Economic Association, vol. 85(2), pages 9-15, May.
  19. Heckman, James J & Borjas, George J, 1980. "Does Unemployment Cause Future Unemployment? Definitions, Questions and Answers from a Continuous Time Model of Heterogeneity and State Dependence," Economica, London School of Economics and Political Science, vol. 47(187), pages 247-83, August.
  20. Patricia M. Anderson & Bruce D. Meyer, 1993. "The Unemployment Insurance Payroll Tax and Interindustry and Interfirm Subsidies," NBER Chapters, in: Tax Policy and the Economy, Volume 7, pages 111-144 National Bureau of Economic Research, Inc.
  21. Miles Corak, 1993. "Unemployment Insurance Once Again: The Incidence of Repeat Participation in the Canadian UI Program," Canadian Public Policy, University of Toronto Press, vol. 19(2), pages 162-176, June.
  22. Becker, Gary S & Mulligan, Casey B, 1997. "The Endogenous Determination of Time Preference," The Quarterly Journal of Economics, MIT Press, vol. 112(3), pages 729-58, August.
  23. O'Neill, Donal & Sweetman, Olive, 1998. "Intergenerational Mobility in Britain: Evidence from Unemployment Patterns," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 60(4), pages 431-47, November.
  24. P. B. Levine & D. J. Zimmerman, . "The intergenerational correlation in AFDC participation: Welfare trap or poverty trap?," Institute for Research on Poverty Discussion Papers 1100-96, University of Wisconsin Institute for Research on Poverty.
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Citations

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Cited by:
  1. Andersson, Fredrik & Konrad, Kai A, 2001. "Globalization and Human Capital Formation," CEPR Discussion Papers 2657, C.E.P.R. Discussion Papers.
  2. Corak, Miles, 2001. "Are the Kids All Right? Intergenerational Mobility and Child Well-being in Canada," Analytical Studies Branch Research Paper Series 2001171e, Statistics Canada, Analytical Studies Branch.
  3. Orsetta Causa & Catherine Chapuis, 2009. "Equity in Student Achievement Across OECD Countries: An Investigation of the Role of Policies," OECD Economics Department Working Papers 708, OECD Publishing.
  4. Baldwin, John R. & Peters, Valerie, 2001. "Training as a Human Resource Strategy: The Response to Staff Shortages and Technological Change," Analytical Studies Branch Research Paper Series 2001154e, Statistics Canada, Analytical Studies Branch.
  5. Ekhaugen, Tyra, 2005. "Extracting the causal component from the intergenerational correlation in unemployment," Memorandum 21/2005, Oslo University, Department of Economics.
  6. Grady, Patrick & Kapsalis, Constantine, 2002. "The Approach to Seasonal Unemployment in the Nordic Countries: A Comparison with Canada," MPRA Paper 2991, University Library of Munich, Germany.

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