scholarly journals The Financing of Extended Unemployment Insurance Benefits in the United States.

ILR Review ◽  
1964 ◽  
Vol 17 (4) ◽  
pp. 660
Author(s):  
Leo M. Orwicz ◽  
Harry Malisoff
Keyword(s):  
United States ◽  
Unemployment Insurance ◽  
The United States ◽  
Insurance Benefits

EFFECTS OF EXTENDED UNEMPLOYMENT INSURANCE BENEFITS ON LABOR DYNAMICS

2015 ◽  
Vol 20 (5) ◽  
pp. 1174-1195 ◽  
Author(s):  
Miquel Faig ◽  
Min Zhang ◽  
Shiny Zhang
Keyword(s):  
United States ◽  
Unemployment Insurance ◽  
The United States ◽  
Unemployment Benefits ◽  
Productivity Shocks ◽  
Insurance Benefits ◽  
Unemployment Compensation ◽  
Percentage Points ◽  
Labor Dynamics ◽  
Compensation Program

We calculate that the extension of unemployment insurance benefits during downturns has significantly increased the variability of unemployment and vacancies in the United States. Taking this into account reduces the value of leisure necessary to match the wide labor market business cycles experienced in the United States using the Mortensen--Pissarides model. For this calculation, we analyze a version of the model where unemployment insurance benefits not only expire but must be earned with prior employment. With these features, we can calibrate the model to be consistent with unemployment responding strongly to productivity shocks and mildly to changes in unemployment insurance policies. Our preferred calibration predicts that the standard deviation of unemployment since 1945 would have fallen by around 37% if there had not been programs extending unemployment benefits during recessions. We also find that the enactment of the Emergency Unemployment Compensation program in 2008 increased the unemployment rate by 0.5 percentage points.

Unemployment Insurance

2014 ◽  
Author(s):  
Stephen A. Woodbury
Keyword(s):  
United States ◽  
Federal Government ◽  
Unemployment Insurance ◽  
Great Recession ◽  
The United States ◽  
Federal State ◽  
Income Support ◽  
The Great Recession ◽  
System P ◽  
Primary Responsibility

Unemployment insurance (UI) provides temporary income support to workers who have lost their jobs and are seeking reemployment. This chapter reviews the origins of the federal-state UI system in the United States and outlines its principles and goals. It also describes the conditions for benefit eligibility, the benefits themselves, and their financing. The UI system is complex and includes many interested parties, including employers, worker advocates, state UI administrators, and the federal government. These parties’ differing views have led to controversies over benefit eligibility, adequacy, and whether the states or federal government should bear primary responsibility for UI. The Great Recession caused most states’ UI trust funds to become insolvent and led to renewed debate over the structure and financing of the system.

Informal Labor and the Efficiency Cost of Social Programs: Evidence from Unemployment Insurance in Brazil

2021 ◽  
Vol 13 (3) ◽  
pp. 167-206
Author(s):  
François Gerard ◽  
Gustavo Gonzaga
Keyword(s):  
United States ◽  
Moral Hazard ◽  
Labor Markets ◽  
Unemployment Insurance ◽  
The United States ◽  
Social Programs ◽  
Informal Labor ◽  
Experimental Variation ◽  
Efficiency Cost ◽  
Quasi Experimental

It is widely believed that the presence of a large informal sector increases the efficiency cost of social programs in developing countries. We evaluate such claims for the case of unemployment insurance (UI) by combining an optimal UI framework with comprehensive data from Brazil. Using quasi-experimental variation in potential UI duration, we find clear evidence for the usual moral hazard problem that UI reduces incentives to return to a formal job. Yet, the associated efficiency cost is lower than it is in the United States, and it is lower in labor markets with higher informality within Brazil. This is because formal reemployment rates are lower to begin with where informality is higher, so that a larger share of workers would draw UI benefits absent any moral hazard. In sum, efficiency concerns may actually become more relevant as an economy formalizes. (JEL J65, O15, O17, E26, D82, J46)

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