Beyond European unemployment insurance. Less moral hazard, more moral assurance?
Günther Schmid
EconStor Open Access Articles and Book Chapters, 2020, vol. 26, issue 4, 465-480
Abstract:
The compromise that emerged from the lengthy debate on European unemployment insurance (EUI) involved the establishment of a ‘European Unemployment Reinsurance Scheme’. However, it was not until the shock waves of the COVID-19 pandemic were felt that any specific measures were actually taken to establish such a scheme. The reasons for such prevarication were, first, doubts as to whether moral hazard can be kept under control and, second, the huge diversity of EU Member States’ coverage and level of social protection. This article offers a third reason for this protracted stalemate: the neglect of moral assurance as a countervailing force of moral hazard. It argues that the concept of unemployment insurance itself needs to be fundamentally revised. Modern labour market policy must cover not only income risks related to unemployment, but also other serious income risks related to critical transitions over the life course. Finally, this article proposes the extension of the European Social Fund to create a European Employment and Social Fund with elements of work-life insurance and a reinsurance mechanism for shock absorption.
Keywords: European Union; European Social Fund; unemployment insurance; social insurance; moral hazard; moral assurance; transitional labour markets; work-life insurance (search for similar items in EconPapers)
Date: 2020
References: Add references at CitEc
Citations: View citations in EconPapers (4)
Downloads: (external link)
https://www.econstor.eu/bitstream/10419/227774/1/F ... ean-unemployment.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:zbw:espost:227774
DOI: 10.1177/1024258920952666
Access Statistics for this article
More articles in EconStor Open Access Articles and Book Chapters from ZBW - Leibniz Information Centre for Economics Contact information at EDIRC.
Bibliographic data for series maintained by ZBW - Leibniz Information Centre for Economics (econstor@zbw-workspace.eu).