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dc.contributor.authorParsons, Donald O.en_US
dc.date.accessioned2012-01-30en_US
dc.date.accessioned2012-02-07T10:47:21Z-
dc.date.available2012-02-07T10:47:21Z-
dc.date.issued2011en_US
dc.identifier.piurn:nbn:de:101:1-201110263414-
dc.identifier.urihttp://hdl.handle.net/10419/55070-
dc.description.abstractJob displacement insurance typically includes both unemployment benefits and lump-sum severance pay, and each has provoked policy concerns. Unemployment insurance concerns have centered on distorted job search/offer acceptance decisions by the worker, severance-induced firing cost concerns on excessive labor hoarding by firms. A single period private contracting model is used to investigate the interaction of these two seemingly distinct issues. Viewed singly, familiar results emerge. The absence of separation benefits of any kind leads to excessive labor hoarding as a primitive form of earnings insurance. In a limited information environment, the distribution of job displacement insurance between the two benefit types becomes important. Unemployment insurance benefits must be limited (relative to first-best levels) and severance pay made more generous. Firing cost considerations are less familiar. Because the firm wants to provide benefits, they cannot be contracted around. Although formally driven by the sum of (unsubsidized) severance pay and expected unemployment benefits, the second-best firing cost program limits severance pay only. Together the two constraints create an unpromising contracting environment. The firing cost constraint is the more easily relaxed by government action - subsidies of sufficient size to one or another of the separation programs will work. Offer acceptance requires restrictions on leisure (workfare). Unfortunately, if first-best benefits are mandated, efficiency requires that both be eased.en_US
dc.language.isoengen_US
dc.publisherIZA Bonnen_US
dc.relation.ispartofseriesDiscussion paper series // Forschungsinstitut zur Zukunft der Arbeit 6003en_US
dc.subject.jelJ65en_US
dc.subject.jelJ41en_US
dc.subject.jelJ33en_US
dc.subject.jelJ08en_US
dc.subject.ddc330en_US
dc.subject.keywordjob displacementen_US
dc.subject.keywordunemployment insuranceen_US
dc.subject.keywordseverance payen_US
dc.subject.keywordmoral hazarden_US
dc.subject.keywordfiring costsen_US
dc.subject.stwKündigungen_US
dc.subject.stwKostenen_US
dc.subject.stwArbeitslosenversicherungen_US
dc.subject.stwLohnen_US
dc.subject.stwBetriebszugehörigkeiten_US
dc.subject.stwMoral Hazarden_US
dc.subject.stwUnterbeschäftigungen_US
dc.subject.stwTheorieen_US
dc.titleDouble-sided moral hazard in job displacement insurance contractsen_US
dc.typeWorking Paperen_US
dc.identifier.ppn684390086en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen_US
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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