An Unemployment Insurance Scheme for the Euro Area? A Comparison of Different Alternatives Using Micro Data

Mathias Dolls, Clemens Fuest, Dirk Neumann () and Andreas Peichl

No 5581, CESifo Working Paper Series from CESifo

Abstract: We analyze different options for the design of a common unemployment insurance system for the euro area (EA). We assess their effectiveness to act as an insurance device in the presence of asymmetric macroeconomic shocks. Running counterfactual simulations based on micro data for the period 2000-13, we quantify the trade-off between automatic stabilization effects and the degree of cross-country transfers. In the baseline, we focus on a non-contingent scheme covering short-term unemployment and find that it would have absorbed a significant fraction of the unemployment shock in the recent crisis. However, four member states of the EA18 would have been either a permanent net contributor or net recipient. Our results suggest that contingent benefits could limit the degree of cross-country redistribution, but might reduce desired insur-ance effects. We also study heterogeneous effects within countries and discuss moral hazard issues at the level of individuals, the administration and economic policy.

Keywords: European fiscal integration; unemployment insurance; automatic stabilizers (search for similar items in EconPapers)
JEL-codes: F55 H23 J65 (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

Downloads: (external link)
https://www.cesifo.org/DocDL/cesifo1_wp5581.pdf (application/pdf)

Related works:
Journal Article: An unemployment insurance scheme for the euro area? A comparison of different alternatives using microdata (2018)
Working Paper: An unemployment insurance scheme for the euro area? A comparison of different alternatives using micro data (2015)
Working Paper: An Unemployment Insurance Scheme for the Euro Area? A Comparison of Different Alternatives using Micro Data (2014)
Working Paper: An unemployment insurance scheme for the euro area? A comparison of different alternatives using micro data (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:ces:ceswps:_5581

Access Statistics for this paper

More papers in CESifo Working Paper Series from CESifo Contact information at EDIRC.
Bibliographic data for series maintained by Klaus Wohlrabe ().