Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/3848 
Year of Publication: 
2006
Series/Report no.: 
CEPR Discussion Paper Series No. 5692
Publisher: 
Centre for Economic Policy Research (CEPR), London
Abstract: 
We explore the far-reaching implications of replacing current unemployment benefit (UB) systems by an unemployment accounts (UA) system. Under the UA system, employed people are required to make ongoing contributions to their UAs and the balances in these accounts are available to them during periods of unemployment. The government is able to undertake balancedbudget interpersonal redistributions among the UAs. At the end of their working lives, people could transfer the remaining balances on their UAs into their pensions. We present an analytical framework to analyse the incentive effects of UAs and calibrate our model for the high unemployment countries of Europe. Our results suggest that this policy reform would significantly change people's employment incentives and could achieve reductions in unemployment without reducing the level of support to the unemployed.
JEL: 
I38
J22
J32
J38
J64
J65
J68
Document Type: 
Working Paper

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