Are unemployment benefits harmful to the stability of working careers? The case of Spain

Yolanda F. Rebollo-Sanz and J. García-Pérez ()
Authors registered in the RePEc Author Service: J. Ignacio García Pérez ()

SERIEs: Journal of the Spanish Economic Association, 2015, vol. 6, issue 1, 41 pages

Abstract: Unemployment insurance is usually found to show negative effects in the transition from unemployment to a new job. However, the extent to which workers’ careers might improve or deteriorate as a result of the unemployment insurance system is not immediately clear. This paper addresses the effects of certain aspects of this system on employment stability by jointly accounting for benefits endogeneity, dynamic selection issues and occurrence dependence. The analysis is undertaken for a dual labour market, such as the market in Spain, where temporary and permanent workers differ with respect to numerous individual and labour market characteristics. We find that non-insured unemployed workers experience a greater rate of transition to employment than insured workers. But we also find that benefits encourage job stability for temporary workers not only by increasing subsequent job tenure but also by increasing the probability of entering into a permanent contract. Finally, we get that shortening the duration of the benefit entitlement period does not seem to lead to significant gains in overall employment stability, which increases at most by 4.3 %. Copyright The Author(s) 2015

Keywords: Unemployment insurance; Multivariate mixed proportional hazard model; Job turnover; Employment stability; Employment dynamics; J63; J64; J65; J68 (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (23)

Downloads: (external link)
http://hdl.handle.net/10.1007/s13209-014-0120-z (text/html)
Access to full text is restricted to subscribers.

Related works:
Working Paper: Are Unemployment Benefits harmful to the stability of working careers? The case of Spain (2015)
Working Paper: Are Unemployment Benefits harmful to the stability of working careers? The case of Spain (2014)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:series:v:6:y:2015:i:1:p:1-41

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/13209

DOI: 10.1007/s13209-014-0120-z

Access Statistics for this article

SERIEs: Journal of the Spanish Economic Association is currently edited by Nezih Guner

More articles in SERIEs: Journal of the Spanish Economic Association from Springer, Spanish Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().