What Drives Wage Effects of Unemployment Benefits? Evidence from Natural Experiments and Reservation Wage Data

Patrick Arni

VfS Annual Conference 2017 (Vienna): Alternative Structures for Money and Banking from Verein für Socialpolitik / German Economic Association

Abstract: How should we interpret wage effects of UI benefits? Policy conclusions are fundamentally different depending on whether the effects mostly operate through unemployment duration or through reservation wages. This paper combines for the first time all three necessary outcomes within the same natural experiments. We find reservation wage effects of about +1% per 20 days of extended potential benefit duration. Interestingly, the importance of the two channels of wage effects is age-dependent.

JEL-codes: J64 J65 (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:vfsc17:168154

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