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Unemployment Insurance and Means-Tested Program Interactions: Evidence from Administrative Data

Pauline Leung and Christopher O'Leary

American Economic Journal: Economic Policy, 2020, vol. 12, issue 2, 159-92

Abstract: We study the ways in which unemployment insurance (UI) benefits interact with other elements of the social safety net around job losses. We exploit a cutoff for UI eligibility, based on a workers' highest quarterly earnings in the past year, to generate quasi-experimental variation in UI receipt. We find that UI receipt cuts welfare (TANF) receipt by half among low-earning UI applicants but has no impact on SNAP or Medicaid usage. However, because welfare participation is low in this population, overall crowdout is small. In the quarter following layoff, UI increases total income by 55 percent (including labor earnings and transfers).

JEL-codes: E24 H53 I18 I38 J64 J65 (search for similar items in EconPapers)
Date: 2020
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DOI: 10.1257/pol.20170262

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American Economic Journal: Economic Policy is currently edited by Matthew Shapiro

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Handle: RePEc:aea:aejpol:v:12:y:2020:i:2:p:159-92