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Erscheinungsjahr: 
2005
Schriftenreihe/Nr.: 
Working Paper No. 2005:13
Verlag: 
Institute for Labour Market Policy Evaluation (IFAU), Uppsala
Zusammenfassung: 
This paper analyses crucial design features of unemployment insurance (UI) policies. We examine three different means of improving the efficiency of UI: the duration of benefit payments, monitoring in conjunction with sanctions, and workfare. To that end we develop a quantitative model of equilibrium unemployment. The model features worker heterogeneity in preferences for leisure. The numerical analysis suggests that a system with monitoring and sanctions restores search incentives most effectively, since it brings additional incentives to search actively so as to avoid the sanction. Therefore, the UI provider can offer a more generous UI replacement rate in a system with monitoring and sanctions than in the other two systems. Workfare appears to be inferior to the other two systems.
Schlagwörter: 
Unemployment insurance
search equilibrium
time limits
monitoring and sanctions
workfare
JEL: 
J64
J68
Dokumentart: 
Working Paper

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