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The Impact of Unemployment Insurance Benefit Levels on Recipiency

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  • McCall, Brian P

Abstract

This paper studies the effect of unemployment insurance benefit levels on recipiency. Increasing benefit levels (as measured by the fraction of weekly earnings of the lost job that they replace) is found to significantly increase the probability of unemployment insurance recipiency among the eligible. There is some evidence, however, that the effect is smaller at high replacement rates. Cost increases resulting from take-up responses are found to be substantial for increases in the state's maximum benefit amount and for increases in the weekly benefit amount in low-replacement-rate states.

Suggested Citation

  • McCall, Brian P, 1995. "The Impact of Unemployment Insurance Benefit Levels on Recipiency," Journal of Business & Economic Statistics, American Statistical Association, vol. 13(2), pages 189-198, April.
  • Handle: RePEc:bes:jnlbes:v:13:y:1995:i:2:p:189-98
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    Cited by:

    1. Budd, John W & Na, In-Gang, 2000. "The Union Membership Wage Premium for Employees Covered by Collective Bargaining Agreements," Journal of Labor Economics, University of Chicago Press, vol. 18(4), pages 783-807, October.
    2. Isabel Poblete, 2011. "Análisis del uso de beneficios en el Seguro de Cesantía Chileno," Working Papers 51, Superintendencia de Pensiones, revised Oct 2011.
    3. Donald O. Parsons & Torben Tranæs & Helene Bie Lilleør, 1999. "Voluntary Public Unemployment Insurance," EPRU Working Paper Series 03-05, Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics, revised Jun 2003.
    4. Eduardo Fajnzylber R. & Isabel Poblete H., 2013. "Analysis of the use of benefits under Chilean unemployment insurance," Journal Economía Chilena (The Chilean Economy), Central Bank of Chile, vol. 16(3), pages 32-68, December.
    5. Peter Ganong & Jeffrey B. Liebman, 2013. "The Decline, Rebound, and Further Rise in SNAP Enrollment: Disentangling Business Cycle Fluctuations and Policy Changes," NBER Working Papers 19363, National Bureau of Economic Research, Inc.
    6. Jonathan Gruber & Julie Berry Cullen, 1996. "Spousal Labor Supply as Insurance: Does Unemployment Insurance Crowd Outthe Added Worker Effect?," NBER Working Papers 5608, National Bureau of Economic Research, Inc.
    7. Bruce D. Meyer & Wallace K. C. Mok, 2007. "Quasi-Experimental Evidence on the Effects of Unemployment Insurance from New York State," NBER Working Papers 12865, National Bureau of Economic Research, Inc.
    8. John W. Budd, 2010. "Does Employee Ignorance Undermine Shared Capitalism?," NBER Chapters,in: Shared Capitalism at Work: Employee Ownership, Profit and Gain Sharing, and Broad-based Stock Options, pages 291-316 National Bureau of Economic Research, Inc.
    9. Avraham Ebenstein & Kevin Stange, 2010. "Does inconvenience explain low take-up? Evidence from unemployment insurance," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 29(1), pages 111-136.
    10. James J. Heckman & Jeffrey A. Smith, 2004. "The Determinants of Participation in a Social Program: Evidence from a Prototypical Job Training Program," Journal of Labor Economics, University of Chicago Press, vol. 22(2), pages 243-298, April.
    11. Card, David & Levine, Phillip B., 2000. "Extended benefits and the duration of UI spells: evidence from the New Jersey extended benefit program," Journal of Public Economics, Elsevier, vol. 78(1-2), pages 107-138, October.
    12. Riphahn, Regina T., 2000. "Rational Poverty or Poor Rationality? The Take-up of Social Assistance Benefits," IZA Discussion Papers 124, Institute for the Study of Labor (IZA).
    13. Cynthia K. Gustafson & Phillip B. Levine, 1998. "Less-Skilled Workers, Welfare Reform, and the Unemployment Insurance System," NBER Working Papers 6489, National Bureau of Economic Research, Inc.
    14. Carl Davidson & Stephen A. Woodbury, 1997. "The Optimal Dole with Risk Aversion, Job Destruction, and Worker Heterogeneity," Upjohn Working Papers and Journal Articles 97-47, W.E. Upjohn Institute for Employment Research.
    15. Kroft, Kory, 2008. "Takeup, social multipliers and optimal social insurance," Journal of Public Economics, Elsevier, vol. 92(3-4), pages 722-737, April.
    16. Patricia M. Anderson & Bruce D. Meyer, 1994. "Unemployment Insurance Benefits and Takeup Rates," NBER Working Papers 4787, National Bureau of Economic Research, Inc.
    17. Patricia M. Anderson & Bruce D. Meyer, 1994. "The Effects of Unemployment Insurance Taxes and Benefits on Layoffs Using Firm and Individual Data," NBER Working Papers 4960, National Bureau of Economic Research, Inc.
    18. Bruce D. Meyer & Wallace K. C. Mok, 2014. "A Short Review of Recent Evidence on the Disincentive Effects of Unemployment Insurance and New Evidence From New York State," National Tax Journal, National Tax Association, vol. 67(1), pages 219-252, March.

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