Beiträge zur Jahrestagung des Vereins für Socialpolitik 2017: Alternative Geld- und Finanzarchitekturen - Session: Unemployment I B05-V2
How should we interpret wage effects of UI benefits? Policy conclusions are fundamentally different depending on whether the effects mostly operate through unemployment duration or through reservation wages. This paper combines for the first time all three necessary outcomes within the same natural experiments. We find reservation wage effects of about +1% per 20 days of extended potential benefit duration. Interestingly, the importance of the two channels of wage effects is age-dependent.