Unemployment and the Social Safety Net during Transitions to a Market Economy: Evidence from the Czech and Slovak Republics
The authors investigate the remarkably short unemployment spells in the Czech Republic compared to Slovakia and other Central and East European economies. They estimate hazard functions and find that 40 to 5O percent of the difference in unemployment durations between the two republics is accounted for by differences in demographics and demand conditions. The remainder is explained by differences in coefficients, proxying the behavior of firms, individuals, and institutions. In both republics, the unemployment compensation system has a moderately negative effect on the exit rate from unemployment. Policymakers, hence, have latitude in providing adequate social safety nets without jeopardizing efficiency. Copyright 1998 by American Economic Association.
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Volume (Year): 88 (1998)
Issue (Month): 5 (December)
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