Market Externalities of Large Unemployment Insurance Extension Programs

Rafael Lalive, Camille Landais and Josef Zweimüller ()

American Economic Review, 2015, vol. 105, issue 12, 3564-96

Abstract: We provide evidence that unemployment insurance affects equilibrium conditions in the labor market, which creates significant "market externalities." We provide a framework for identification of such equilibrium effects and implement it using the Regional Extension Benefit Program (REBP) in Austria which extended the duration of UI benefits for a large group of eligible workers in selected regions of Austria. We show that non-eligible workers in REBP regions have higher job finding rates, lower unemployment durations, and a lower risk of long-term unemployment. We discuss the implications of our results for optimal UI policy. (JEL E24, J64, J65, R23)

JEL-codes: E24 J64 J65 R23 (search for similar items in EconPapers)
Date: 2015
Note: DOI: 10.1257/aer.20131273
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Citations: View citations in EconPapers (130)

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Related works:
Working Paper: Market externalities of large unemployment insurance extension programs (2015)
Working Paper: Market Externalities of Large Unemployment Insurance Extension Programs (2013)
Working Paper: Market Externalities of Large Unemployment Insurance Extension Programs (2013)
Working Paper: Market Externalities of Large Unemployment Insurance Extension Programs (2013)
Working Paper: Market Externalities of Large Unemployment Insurance Extension Programs (2013)
Working Paper: Market Externalities of Large Unemployment Insurance Extension Programs (2013)
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