Micro and Macro Effects of UI Policies: Evidence from Missouri

Fatih Karahan, Kurt Mitman and Brendan Moore

No 905, Staff Reports from Federal Reserve Bank of New York

Abstract: We develop a method to jointly measure the response of worker search effort (micro effect) and vacancy creation (macro effect) to changes in the duration of unemployment insurance (UI) benefits. To implement this approach, we exploit an unexpected cut in UI durations in Missouri and provide quasi-experimental evidence on the effect of UI on the labor market. The data indicate that the cut in Missouri significantly increased job finding rates by both raising the search effort of unemployed workers and the availability of jobs. The latter accounts for at least one half of the total effect.

Keywords: unemployment; vacancies; unemployment insurance; search (search for similar items in EconPapers)
JEL-codes: E24 J63 J64 J65 (search for similar items in EconPapers)
Pages: 45
Date: 2019-12-01
Note: Revised April 2022. Previous title: “Individual and Market-Level Effects of UI Policies: Evidence from Missouri”
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Citations: View citations in EconPapers (6)

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Working Paper: Micro and Macro Effects of UI Policies: Evidence from Missouri (2022)
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