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Explaining the trasitions out of unemployement in Spain : the effect of unemployement insurance

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  • Alba, Alfonso

Abstract

In this article we study the factors that affect the transitions out of unemployment in Spain. We pay special attention to the impact of unemployment insurance benefits on the re-employment probability. We use a multinomiallogit model, and data from the EPA matched files from the second quarter of 1987 to the fourth quarter of 1995. Consistent with previous work, we find a negative effect of unemployment insurance receipt on the re-employment probability, and on withdrawal from the labor force. More importantly, we find a differential effect of benefit receipt when comparing time periods before and afier 1992. In april of that year the labor authority made eligibility requirements for unemployment insurance more restrictive, and curtailed benefit amounts.

Suggested Citation

  • Alba, Alfonso, 1996. "Explaining the trasitions out of unemployement in Spain : the effect of unemployement insurance," UC3M Working papers. Economics 4108, Universidad Carlos III de Madrid. Departamento de Economía.
    • Handle: RePEc:cte:werepe:4108
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    2. Alfonso Alba-Ramirez & Richard B. Freeman, 1990. "Jobfinding and Wages when Longrun Unemployment is Really Long: The Case of Spain," NBER Working Papers 3409, National Bureau of Economic Research, Inc.
    3. 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.
    4. Poterba, James M & Summers, Lawrence H, 1995. "Unemployment Benefits and Labor Market Transitions: A Multinomial Logit Model with Errors in Classification," The Review of Economics and Statistics, MIT Press, vol. 77(2), pages 207-216, May.
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