The trade-off between insurance and incentives in differentiated unemployment policies

Johannes Spinnewijn

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: In this paper, I revisit the central trade-off between insurance and incentives in the design of unemployment insurance policies. The generosity of unemployment insurance benefits differs not only across countries, but also across workers within countries. After illustrating some important dimensions of heterogeneity in a cross-country analysis, I extend the standard Baily–Chetty formula to identify the key empirical moments and elasticities required to evaluate the differentiated unemployment policy within a country. I also review some prior work and aim to provide guidance for future work trying to inform the design of unemployment policies.

Keywords: heterogeneity; policy design; unemployment (search for similar items in EconPapers)
JEL-codes: H20 J64 J65 (search for similar items in EconPapers)
Pages: 27 pages
Date: 2020-03-01
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Published in Fiscal Studies, 1, March, 2020, 41(1), pp. 101 - 127. ISSN: 0143-5671

Downloads: (external link)
http://eprints.lse.ac.uk/104718/ Open access version. (application/pdf)

Related works:
Journal Article: The Trade‐Off between Insurance and Incentives in Differentiated Unemployment Policies (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:104718

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