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The Determination of Unemployment Benefits

Author

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  • Di Tella, R.
  • MacCulloch, R.

Abstract

We present a simple model where unemployment benefits are determined in an economy in which there is endogenous delay in finding a job so that workers desire insurance against the possibility of unemployment.

Suggested Citation

  • Di Tella, R. & MacCulloch, R., 1996. "The Determination of Unemployment Benefits," Economics Series Working Papers 99180, University of Oxford, Department of Economics.
    • Handle: RePEc:oxf:wpaper:99180
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    References listed on IDEAS

    as
    1. Kiander, Jaakko, 1993. "Endogenous unemployment insurance in a monopoly union model when job search matters," Journal of Public Economics, Elsevier, vol. 52(1), pages 101-115, August.
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    5. Olivier Blanchard & Lawrence F. Katz, 1997. "What We Know and Do Not Know about the Natural Rate of Unemployment," Journal of Economic Perspectives, American Economic Association, vol. 11(1), pages 51-72, Winter.
    6. Baily, Martin Neil, 1978. "Some aspects of optimal unemployment insurance," Journal of Public Economics, Elsevier, vol. 10(3), pages 379-402, December.
    7. Cameron, David R., 1978. "The Expansion of the Public Economy: A Comparative Analysis," American Political Science Review, Cambridge University Press, vol. 72(4), pages 1243-1261, December.
    8. Erzo F. P. Luttmer, 2001. "Group Loyalty and the Taste for Redistribution," Journal of Political Economy, University of Chicago Press, vol. 109(3), pages 500-528, June.
    9. Ehrenberg, Ronald G & Oaxaca, Ronald L, 1976. "Unemployment Insurance, Duration of Unemployment, and Subsequent Wage Gain," American Economic Review, American Economic Association, vol. 66(5), pages 754-766, December.
    10. Flemming, J. S., 1978. "Aspects of optimal unemployment insurance : Search, leisure, savings and capital market imperfections," Journal of Public Economics, Elsevier, vol. 10(3), pages 403-425, December.
    11. Wright, Randall, 1986. "The redistributive roles of unemployment insurance and the dynamics of voting," Journal of Public Economics, Elsevier, vol. 31(3), pages 377-399, December.
    12. Feldstein, Martin S, 1978. "The Effect of Unemployment Insurance on Temporary Layoff Unemployment," American Economic Review, American Economic Association, vol. 68(5), pages 834-846, December.
    13. Shapiro, Carl & Stiglitz, Joseph E, 1984. "Equilibrium Unemployment as a Worker Discipline Device," American Economic Review, American Economic Association, vol. 74(3), pages 433-444, June.
    14. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 58(2), pages 277-297.
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    Citations

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    Cited by:

    1. Holmlund, Bertil, 1997. "Unemployment Insurance in Theory and Practice," Working Paper Series 1997:25, Uppsala University, Department of Economics.
    2. Olivier Blanchard & Lawrence F. Katz, 1997. "What We Know and Do Not Know about the Natural Rate of Unemployment," Journal of Economic Perspectives, American Economic Association, vol. 11(1), pages 51-72, Winter.
    3. MacCulloch, Robert, 1999. "What makes a revolution?," ZEI Working Papers B 24-1999, University of Bonn, ZEI - Center for European Integration Studies.
    4. Howell David R. & Baker Dean & Glyn Andrew & Schmitt John, 2007. "Are Protective Labor Market Institutions at the Root of Unemployment? A Critical Review of the Evidence," Capitalism and Society, De Gruyter, vol. 2(1), pages 1-73, May.
    5. Oswald, Andrew J., 1996. "A Conjecture on the Explanation for High Unemployment in the Industrialized Nations: Part I," Economic Research Papers 268744, University of Warwick - Department of Economics.
    6. Di Tella, Rafael & MacCulloch, Robert, 2008. "Gross national happiness as an answer to the Easterlin Paradox?," Journal of Development Economics, Elsevier, vol. 86(1), pages 22-42, April.
    7. Di Tella, Rafael & MacCulloch, Robert, 2005. "The consequences of labor market flexibility: Panel evidence based on survey data," European Economic Review, Elsevier, vol. 49(5), pages 1225-1259, July.
    8. Robert MacCulloch, 2001. "Does Social Insurance Help Secure Property Rights?," STICERD - Development Economics Papers - From 2008 this series has been superseded by Economic Organisation and Public Policy Discussion Papers 31, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.
    9. Tetsuya Matsubayashi & Michiko Ueda, 2012. "Government Partisanship and Human Well-Being," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 107(1), pages 127-148, May.
    10. Kuhn, Andreas, 2009. "In the Eye of the Beholder: Subjective Inequality Measures and the Demand for Redistribution," IZA Discussion Papers 4360, Institute of Labor Economics (IZA).
    11. Rafael Di Tella & Robert J. MacCulloch & Andrew J. Oswald, 2003. "The Macroeconomics of Happiness," The Review of Economics and Statistics, MIT Press, vol. 85(4), pages 809-827, November.
    12. Andreas Kuhn, 2009. "In the eye of the beholder: subjective inequality measures and the demand for redistribution," IEW - Working Papers 425, Institute for Empirical Research in Economics - University of Zurich.
    13. Matsubayashi, Tetsuya & Ueda, Michiko, 2011. "The effect of national suicide prevention programs on suicide rates in 21 OECD nations," Social Science & Medicine, Elsevier, vol. 73(9), pages 1395-1400.
    14. John Hassler & José V. Rodríguez Mora & Kjetil Storesletten & Fabrizio Zilibotti, 1998. "Equilibrium unemployment insurance," Economics Working Papers 605, Department of Economics and Business, Universitat Pompeu Fabra, revised Jun 1999.
    15. David R. Howell & Miriam Rehm, 2009. "Unemployment compensation and high European unemployment: a reassessment with new benefit indicators," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 25(1), pages 60-93, Spring.
    16. Douglas, R & MacCulloch, Robert, 2016. "Welfare: Savings not Taxation," Working Papers 31890, Department of Economics, The University of Auckland.
    17. Laszlo Goerke & Markus Pannenberg & Heinrich Ursprung, 2010. "A positive theory of the earnings relationship of unemployment benefits," Public Choice, Springer, vol. 145(1), pages 137-163, October.
    18. Rafael Di Tella & Robert MacCulloch, 2014. "Culture, Beliefs and Economic Performance," Working Papers 14_06, Motu Economic and Public Policy Research.
    19. Niklas Potrafke, 2010. "Labor market deregulation and globalization: empirical evidence from OECD countries," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 146(3), pages 545-571, September.
    20. Huang, Emma Li-Hsuan & Huang, Julia Hsin-Yi, 2013. "Labor Market Reforms on the Unemployment Rate and Wage Payments in Europe," MPRA Paper 63248, University Library of Munich, Germany.
    21. Botta, Alberto & Tippet, Ben, 2020. "The roots of a divided eurozone: rigid labour markets or asymmetric technology-macroeconomic regimes?," Greenwich Papers in Political Economy 30958, University of Greenwich, Greenwich Political Economy Research Centre.
    22. Andreas Kuhn, 2009. "In the Eye of the Beholder: Subjective Inequality Measures and the Demand for Redistribution," NRN working papers 2009-14, The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria.
    23. Neugart, Michael, 2005. "Unemployment insurance: The role of electoral systems and regional labour markets," European Journal of Political Economy, Elsevier, vol. 21(4), pages 815-829, December.
    24. Di Tella, Rafael & MacCulloch, Robert, 2006. "Europe vs America: Institutional hysteresis in a simple normative model," Journal of Public Economics, Elsevier, vol. 90(12), pages 2161-2186, December.
    25. Fredriksson, Peter, 1999. "The political economy of public employment programs," Journal of Public Economics, Elsevier, vol. 72(3), pages 487-504, June.

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    More about this item

    Keywords

    UNEMPLOYMENT; LABOUR MARKET;

    JEL classification:

    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • 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
    • J69 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Other

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