Bouis, Romain Causa, Orsetta Demmou, Lilas Duval, Romain
Year of Publication:
[Journal:] IZA Journal of Labor Policy [ISSN:] 2193-9004 [Publisher:] Springer [Place:] Heidelberg [Volume:] 1 [Year:] 2012 [Pages:] 1-12
While there is a fairly broad consensus regarding the potential adverse effects of generous unemployment benefit insurance on steady-state employment, the short-term effects of benefit reforms are not well-established. This paper contributes to fill this gap by estimating impulse responses to benefit reform shocks identified for a panel of OECD countries. Findings indicate that although it takes time for unemployment benefit reforms to pay off, such reforms do not appear to entail any negative short-run effects. There is however some suggestive evidence that reducing unemployment benefits could have negative short-run effects in bad times.
institutions reforms labor market macroeconomic conditions impulse response function institutions reforms labor market macroeconomic conditions impulse response function