IDEAS home Printed from https://ideas.repec.org/p/ese/emodwp/em3-12.html
   My bibliography  Save this paper

Welfare compensation for unemployment in the Great Recession

Author

Listed:
  • Fernandez Salgado, Mariña
  • Figari, Francesco
  • Sutherland, Holly
  • Tumino, Alberto

Abstract

This paper analyses the extent to which tax-benefit systems provide an automatic stabilisation of income for those who became unemployed at the onset of the Great Recession. The focus of the analysis is on the compensation for earnings lost due to unemployment which is channelled through the welfare systems to this group of people who are clearly vulnerable to the recession‟s adverse effects. In order to assess the impact of unemployment on household income, counterfactual scenarios are simulated by using EUROMOD, the EU-wide microsimulation model, integrated with information from the EU-LFS data. This paper provides evidence on the differing degrees of relative and absolute resilience of the household incomes of the new unemployed. These arise from the variations in the protection offered by the national tax-benefit systems, depending on entitlement or not to Unemployment Benefits, and from the personal and household circumstances of those most recently at risk of unemployment in the countries considered.

Suggested Citation

  • Fernandez Salgado, Mariña & Figari, Francesco & Sutherland, Holly & Tumino, Alberto, 2012. "Welfare compensation for unemployment in the Great Recession," EUROMOD Working Papers EM3/12, EUROMOD at the Institute for Social and Economic Research.
  • Handle: RePEc:ese:emodwp:em3-12
    as

    Download full text from publisher

    File URL: https://www.iser.essex.ac.uk/research/publications/working-papers/euromod/em3-12.pdf
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. François Bourguignon & Amedeo Spadaro, 2006. "Microsimulation as a tool for evaluating redistribution policies," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 4(1), pages 77-106, April.
    2. Konstantinos Tatsiramos, 2009. "Unemployment Insurance in Europe: Unemployment Duration and Subsequent Employment Stability," Journal of the European Economic Association, MIT Press, vol. 7(6), pages 1225-1260, December.
    3. Dolls, Mathias & Fuest, Clemens & Peichl, Andreas, 2012. "Automatic stabilizers and economic crisis: US vs. Europe," Journal of Public Economics, Elsevier, vol. 96(3), pages 279-294.
    4. Callan, Tim & Leventi, Chrysa & Levy, Horacio & Matsaganis, Manos & Paulus, Alari & Sutherland, Holly, 2011. "The distributional effects of austerity measures: a comparison of six EU countries," EUROMOD Working Papers EM6/11, EUROMOD at the Institute for Social and Economic Research.
    5. Alfonso ARPAIA & Nicola CURCI, "undated". "EU labour market behaviour during the Great Recession," Working Papers wp2010-6, Department of the Treasury, Ministry of the Economy and of Finance.
    6. Walter Bossert & Conchita D'Ambrosio, 2013. "Measuring Economic Insecurity," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 54, pages 1017-1030, August.
    7. Aaberge, Rolf, et al, 2000. " Unemployment Shocks and Income Distribution: How Did the Nordic Countries Fare during Their Crises?," Scandinavian Journal of Economics, Wiley Blackwell, vol. 102(1), pages 77-99, March.
    8. Francesco Figari & Andrea Salvatori & Holly Sutherland, 2011. "Economic Downturn and Stress Testing European Welfare Systems," Research in Labor Economics,in: Who Loses in the Downturn? Economic Crisis, Employment and Income Distribution, volume 32, pages 257-286 Emerald Publishing Ltd.
    9. Iacus, Stefano M. & King, Gary & Porro, Giuseppe, 2011. "Multivariate Matching Methods That Are Monotonic Imbalance Bounding," Journal of the American Statistical Association, American Statistical Association, vol. 106(493), pages 345-361.
    10. Carlo V Fiorio & Francesco D'Amuri, 2006. "Tax Evasion In Italy: An Analysis Using A Tax-Benefit Microsimulation Model," The IUP Journal of Public Finance, IUP Publications, vol. 0(2), pages 19-37, May.
    11. Holly Sutherland & Francesco Figari, 2013. "EUROMOD: the European Union tax-benefit microsimulation model," International Journal of Microsimulation, International Microsimulation Association, vol. 1(6), pages 4-26.
    12. Lars Osberg & Andrew Sharpe, 2005. "How Should We Measure The "Economic" Aspects Of Well-Being?," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 51(2), pages 311-336, June.
    13. 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.
    14. Manos Matsaganis & Chrysa Leventi, 2013. "The Distributional Impact of the Greek Crisis in 2010," Fiscal Studies, Institute for Fiscal Studies, vol. 34(1), pages 83-108, March.
    15. David M. Cutler & Lawrence F. Katz, 1991. "Macroeconomic Performance and the Disadvantaged," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 22(2), pages 1-74.
    16. Bea Cantillon, 2011. "The Paradox of the Social Investment State. Growth, Employment and Poverty in the Lisbon Era," Working Papers 1103, Herman Deleeck Centre for Social Policy, University of Antwerp.
    17. Osberg, Lars & Sharpe, Andrew, 2002. "An Index of Economic Well-Being for Selected OECD Countries," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 48(3), pages 291-316, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Mathias Dolls & Clemens Fuest & Dirk Neumann & Andreas Peichl, 2018. "An unemployment insurance scheme for the euro area? A comparison of different alternatives using microdata," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 25(1), pages 273-309, February.
    2. Holly Sutherland & Francesco Figari, 2013. "EUROMOD: the European Union tax-benefit microsimulation model," International Journal of Microsimulation, International Microsimulation Association, vol. 1(6), pages 4-26.
    3. Dolls, Mathias & Lewney, Richard, 2017. "Backward-looking analysis," ZEW Expertises, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research, number 149873.
    4. Romina Boarini & Lars Osberg, 2014. "Economic Insecurity: Editors' Introduction," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 60(S1), pages 1-4, May.
    5. Figari, Francesco & Paulus, Alari & Sutherland, Holly, 2014. "Microsimulation and policy analysis," ISER Working Paper Series 2014-23, Institute for Social and Economic Research.
    6. Rastrigina, Olga & Leventi, Chrysa & Sutherland, Holly, 2015. "Nowcasting: estimating developments in the risk of poverty and income distribution in 2013 and 2014," EUROMOD Working Papers EM12/15, EUROMOD at the Institute for Social and Economic Research.
    7. Jekaterina Navicke & Olga Rastrigina & Holly Sutherland, 2014. "Nowcasting Indicators of Poverty Risk in the European Union: A Microsimulation Approach," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 119(1), pages 101-119, October.
    8. Leventi, Chrysa & Navicke, Jekaterina & Rastrigina, Olga & Sutherland, Holly, 2014. "Nowcasting risk of poverty and income distribution in the EU in 2013," EUROMOD Working Papers EM11/14, EUROMOD at the Institute for Social and Economic Research.
    9. Rastrigina, Olga & Leventi, Chrysa & Sutherland, Holly, 2015. "Nowcasting risk of poverty and low work intensity in Europe," EUROMOD Working Papers EM9/15, EUROMOD at the Institute for Social and Economic Research.
    10. Jara Tamayo, Holguer Xavier & Sutherland, Holly, 2014. "The implications of an EMU unemployment insurance scheme for supporting incomes," EUROMOD Working Papers EM5/14, EUROMOD at the Institute for Social and Economic Research.

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ese:emodwp:em3-12. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Jonathan Nears). General contact details of provider: http://edirc.repec.org/data/rcessuk.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.