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Unemployment Insurance as a Worker Indiscipline Device? Evidence from Scanner Data

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  • Lusher, Lester

    (University of Pittsburgh)

  • Schnorr, Geoffrey C.

    (University of California, Davis)

  • Taylor, Rebecca L.C.

    (University of Sydney)

Abstract

We provide causal evidence of an ex ante moral hazard effect of Unemployment Insurance (UI) by matching plausibly exogenous changes in UI benefit duration across state-weeks during the Great Recession to high-frequency productivity measures from individual supermarket cashiers. Estimating models with day and cashier-register fixed effects, we identify a modest but statistically significant negative relationship between UI benefits and worker productivity. This effect is strongest for more experienced and less productive cashiers, for whom UI expansions are especially relevant. Additional analyses from the American Time Use Survey reveal a similar increase in shirking during periods with increased UI benefit durations.

Suggested Citation

  • Lusher, Lester & Schnorr, Geoffrey C. & Taylor, Rebecca L.C., 2021. "Unemployment Insurance as a Worker Indiscipline Device? Evidence from Scanner Data," IZA Discussion Papers 14105, Institute of Labor Economics (IZA).
  • Handle: RePEc:iza:izadps:dp14105
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    2. Pagano, Marco, 2020. "Risk Sharing Within the Firm: A Primer," Foundations and Trends(R) in Finance, now publishers, vol. 12(2), pages 117-198, October.
    3. Gordon B. Dahl & Matthew M. Knepper, 2021. "Why is Workplace Sexual Harassment Underreported? The Value of Outside Options Amid the Threat of Retaliation," NBER Working Papers 29248, National Bureau of Economic Research, Inc.
    4. Audrey Guo & Andrew C. Johnston, 2021. "The Finance of Unemployment Compensation and Its Consequences," Public Finance Review, , vol. 49(3), pages 392-434, May.
    5. Guo, Audrey & Johnston, Andrew C., 2020. "The Finance of Unemployment Compensation and its Consequence for the Labor Market," IZA Discussion Papers 13330, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    unemployment insurance; shirking; scanner data;
    All these keywords.

    JEL classification:

    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy
    • J65 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment Insurance; Severance Pay; Plant Closings
    • L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce

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