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The general equilibrium impacts of unemployment insurance: Evidence from a large online job board

Ioana Marinescu ()

Journal of Public Economics, 2017, vol. 150, issue C, 14-29

Abstract: During the Great Recession, U.S. unemployment benefits were extended by up to 73weeks. Theory predicts that extensions increase unemployment by discouraging job search, a partial equilibrium effect. Using data from the large job board CareerBuilder.com, I find that a 10% increase in benefit duration decreased state-level job applications by 1%, but had no robust effect on job vacancies. Job seekers thus faced reduced competition for jobs, a general equilibrium effect. Calibration implies that the general equilibrium effect reduces the impact of unemployment insurance on unemployment by 39%.

Keywords: Unemployment insurance; Job search; Applications; Vacancies (search for similar items in EconPapers)
JEL-codes: J6 (search for similar items in EconPapers)
Date: 2017
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Related works:
Chapter: The General Equilibrium Impacts of Unemployment Insurance: Evidence from a Large Online Job Board (2016)
Working Paper: The General Equilibrium Impacts of Unemployment Insurance: Evidence from a Large Online Job Board (2016) Downloads
Working Paper: The General Equilibrium Impacts of Unemployment Insurance: Evidence from a Large Online Job Board (2016) Downloads
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