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Recherche d'emploi : entre assurance et incitation

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Abstract

The provision of Unemployment Insurance (UI) is associated with adverse incentive effects caused by moral hazard. Monitoring together with sanctions is one of possible instruments to restore incentives without reducing the unemployment subsidies provided by the UI system. Benefit reductions or interruptions are imposed if unemployed workers do not comply with job search guidelines. This paper investigates the effectiveness of such benefit sanctions in reducing unemployment. We use a simple job search model where the unemployment agency can simultaneously monitor search intensity of unemployed and wage offers rejection. We find that benefit sanctions for job refusals have negative effects on search intensity. Consequently, job offers monitoring can increase the unemployment rate and decrease welfare.

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  • Solenne Tanguy, 2004. "Recherche d'emploi : entre assurance et incitation," Cahiers de la Maison des Sciences Economiques v04034, Université Panthéon-Sorbonne (Paris 1).
  • Handle: RePEc:mse:wpsorb:v04034
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    1. Holmlund, Bertil, 1998. " Unemployment Insurance in Theory and Practice," Scandinavian Journal of Economics, Wiley Blackwell, vol. 100(1), pages 113-141, March.
    2. Jaap H. Abbring & Gerard J. Berg & Jan C. Ours, 2005. "The Effect of Unemployment Insurance Sanctions on the Transition Rate from Unemployment to Employment," Economic Journal, Royal Economic Society, vol. 115(505), pages 602-630, July.
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    4. Shavell, Steven & Weiss, Laurence, 1979. "The Optimal Payment of Unemployment Insurance Benefits over Time," Journal of Political Economy, University of Chicago Press, vol. 87(6), pages 1347-1362, December.
    5. Devine, Theresa J. & Kiefer, Nicolas M., 1991. "Empirical Labor Economics: The Search Approach," OUP Catalogue, Oxford University Press, number 9780195059366.
    6. Jan Boone & Jan C. van Ours, 2000. "Modeling Financial Incentives to Get Unemployed Back to Work," Econometric Society World Congress 2000 Contributed Papers 0973, Econometric Society.
    7. Rafael Lalive & Jan C. van Ours & Josef Zweimüller, 2005. "The Effect Of Benefit Sanctions On The Duration Of Unemployment," Journal of the European Economic Association, MIT Press, vol. 3(6), pages 1386-1417, December.
    8. Gilles, Joseph, 2003. "Critères d’attribution des allocations chômage et performances du marché du travail," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2003012, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    9. Gerard J. van den Berg, 1990. "Nonstationarity in Job Search Theory," Review of Economic Studies, Oxford University Press, vol. 57(2), pages 255-277.
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    12. Cahuc, Pierre & Lehmann, Etienne, 2000. "Should unemployment benefits decrease with the unemployment spell?," Journal of Public Economics, Elsevier, vol. 77(1), pages 135-153, July.
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    Cited by:

    1. Talarowski, David, 2012. "Estimation des élasticités du modèle de recherche d'emploi sur données françaises
      [Estimation of the elasticities of the model of job search on French data]
      ," MPRA Paper 38366, University Library of Munich, Germany.

    More about this item

    Keywords

    Unemployment Insurance; job search; incentives; monitoring benefit sanction.;

    JEL classification:

    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • J65 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment Insurance; Severance Pay; Plant Closings
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy

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