Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/226821
Authors: 
Fournier Gabela, Julio G.
Sarmiento, Luis
Year of Publication: 
2020
Series/Report no.: 
DIW Discussion Papers No. 1909
Abstract: 
There is substantial evidence on the effectiveness of short-time work on reducing unemployment. However, no study looks at its role during natural disasters. This article exploits the exogenous nature of the 2013 European floods to assess if the impact depends on the quality of the short-time work mechanism across affected counties. We use regression discontinuity designs to show that unemployment does not increase in regions with robust programs while rising up to seventeen percent in areas with less robust mechanisms. Our results are relevant to the literature on how institutional quality influences recovery and suggests that short-time work programs are useful against unforeseeable productivity shocks besides financial crises.
Subjects: 
flooding
short-time work
regional unemployment
regression discontinuity in time
institutions
JEL: 
J68
H84
Q54
C22
Document Type: 
Working Paper

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