Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/82607
Authors: 
Ek, Susanne
Holmlund, Bertil
Year of Publication: 
2011
Series/Report no.: 
Working Paper, Department of Economics, Uppsala University 2011:4
Abstract: 
A significant fraction of the labor force consists of employed workers who are part-time unemployed (underemployed) in the sense that they are unable to work as much as they prefer. This paper develops a search and matching model to study the design of optimal unemployment insurance in an economy with unemployment as well as part-time unemployment. Part-time unemployment provides income insurance and serves as a stepping stone to full-time jobs. Unemployment benefits for part-timers increase the outflow from unemployment to part-time work but reduce the outflow from part-time work to fulltime employment. We examine the optimal structure of benefits for unemployed and underemployed workers. The results indicate nonnegligible welfare gains associated with time limits for unemployment benefits as well as for part-time benefits. The welfare gains from optimal UI are larger when wages are fixed than when they are flexible.
Subjects: 
job search
part-time unemployment
unemployment insurance
JEL: 
J64
J65
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

Files in This Item:
File
Size
334.88 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.