Why is there a spike in the job finding rate at benefit exhaustion?
Jan Boone and
Jan C van Ours
No 7525, CEPR Discussion Papers from C.E.P.R. Discussion Papers
Putting a limit on the duration of unemployment benefits tends to introduce a "spike" in the job finding rate shortly before benefits are exhausted. Current theories explain this spike from workers' behavior. We present a theoretical model in which also the nature of the job matters. End-of-benefit spikes in job finding rates are related to optimizing behavior of unemployed workers who rationally assume that employers will accept delays in the starting date of a new job, especially if these jobs are permanent. We use a dataset on Slovenian unemployment spells to test this prediction and find supporting evidence. We conclude that the spike in the job finding rate suggests that workers exploit unemployment insurance benefits for subsidized leisure.
Keywords: Spikes; Unemployment (search for similar items in EconPapers)
JEL-codes: I31 J16 J22 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10) Track citations by RSS feed
Downloads: (external link)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at firstname.lastname@example.org
Journal Article: Why is There a Spike in the Job Finding Rate at Benefit Exhaustion? (2012)
Working Paper: Why is there a Spike in the Job Finding Rate at Benefit Exhaustion? (2009)
Working Paper: Why Is There a Spike in the Job Finding Rate at Benefit Exhaustion? (2009)
Working Paper: Why is There a Spike in the Job Finding Rate at Benefit Exhaustion? (2009)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:cpr:ceprdp:7525
Ordering information: This working paper can be ordered from
http://www.cepr.org/ ... ers/dp.php?dpno=7525
Access Statistics for this paper
More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers Centre for Economic Policy Research, 33 Great Sutton Street, London EC1V 0DX.
Bibliographic data for series maintained by ().