Benefit reentitlement conditions in unemployment insurance schemes

Torben M Andersen, Michael Svarer and Kristoffersen, Mark Strøm

No 12802, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: The past employment history - employment requirements - is part of the eligibility conditions for unemployment insurance in most western countries. In a standard search-matching model, we show how employment requirements strengthen the reentitlement effect and thereby changes the trade-off between insurance and incentives in the design of the optimal insurance scheme. Deploying employment requirements for benefit eligibility may thus allow for both higher benefit levels and longer duration, and yet labor market performance is improved. When the need for insurance increases due to higher risk aversion, employment requirements becomes less lenient, and oppositely when the environment becomes more risky.

Keywords: Reentitlement effects; Incentives; Job-search; Unemployment insurance (search for similar items in EconPapers)
JEL-codes: E32 H3 J65 (search for similar items in EconPapers)
Date: 2018-03
New Economics Papers: this item is included in nep-ias, nep-lab and nep-mac
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Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Benefit reentitlement conditions in unemployment insurance schemes (2018)
Working Paper: Benefit Reentitlement Conditions in Unemployment Insurance Schemes (2015)
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