Spending and Job-Finding Impacts of Expanded Unemployment Benefits: Evidence from Administrative Micro Data

Peter Ganong, Fiona E. Greig, Pascal J. Noel, Daniel M. Sullivan and Joseph Vavra

No 30315, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We show that the largest increase in unemployment benefits in U.S. history had large spending impacts and small job-finding impacts. This finding has three implications. First, increased benefits were important for explaining aggregate spending dynamics—but not employment dynamics— during the pandemic. Second, benefit expansions allow us to study the MPC of normally low-liquidity households in a high-liquidity state. These households still have high MPCs. This suggests a role for permanent behavioral characteristics, rather than just current liquidity, in driving spending behavior. Third, the mechanisms driving our results imply that temporary benefit supplements are a promising countercyclical tool.

JEL-codes: E21 E24 E32 E62 E71 G5 H3 J18 J65 (search for similar items in EconPapers)
Date: 2022-08
New Economics Papers: this item is included in nep-lab
Note: EFG LS PE
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

Downloads: (external link)
http://www.nber.org/papers/w30315.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:30315

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w30315

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().