The Lock-in Effects of Part-time Unemployment Benefits

Pierre Cahuc, Benghalem, Hélène and Pierre Villedieu

No 15921, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: We ran a large randomized controlled experiment among about 150,000 recipients of unemployment benefits insurance in France in order to evaluate the impact of part-time unemployment benefits. We took advantage of the lack of knowledge of job seekers regarding this program and sent emails presenting the program. The information provision had a significant positive impact on the propensity to work while on claim, but reduced the unemployment exit rate, showing important lock-in effects into unemployment associated with part-time unemployment benefits. The importance of these lock-in effects implies that decreasing the marginal tax rate on earnings from work while on claim in the neighborhood of its current level does not increase labor supply and increases the expenditure net of taxes of the unemployment insurance agency.

Keywords: Unemployment insurance; Part-time unemployment benefits; Lock-in effects; Unemployment duration (search for similar items in EconPapers)
JEL-codes: H5 J64 J65 (search for similar items in EconPapers)
Date: 2021-03
New Economics Papers: this item is included in nep-ias and nep-lab
References: View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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Related works:
Working Paper: The Lock-in Effects of Part-Time Unemployment Benefits (2022)
Working Paper: The Lock-in Effects of Part-Time Unemployment Benefits (2022)
Working Paper: The Lock-In Effects of Part-Time Unemployment Benefits (2021)
Working Paper: The Lock-In Effects of Part-Time Unemployment Benefits (2021)
Working Paper: The Lock-In Effects of Part-Time Unemployment Benefits (2021)
Working Paper: The Lock-in Effects of Part-Time Unemployment Benefits (2021)
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