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Title:How does the unemployment insurance system shape the time profile of jobless duration? PDF Logo
Authors:Addison, John T.
Portugal, Pedro
Issue Date:2004
Series/Report no.:IZA Discussion paper series 978
Abstract:This paper examines the effects of unemployment insurance on escape rates from unemployment using data from the 1998 Displaced Worker Survey. Transitions from unemployment to employment are modeled using a flexible representation of the baseline hazard function and allowing for discrete changes through time in the effects of unemployment insurance benefits, as well as those of the other covariates. The impact of unemployment insurance is also modeled using a time-varying benefits measure, namely, time to exhaustion of benefits. Potential biases stemming from reverse causation and unobserved individual heterogeneity are accommodated. Both approaches render transparent the major disincentive effects of access to benefits on re-employment rates while also providing evidence of time-varying effects of other regressors.
Subjects:unemployment benefits
unemployment duration
time-varying coefficients/regressors
JEL:J65
J64
Document Type:Working Paper
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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