Macroeconomic Effects of UI Extensions at Short and Long Durations

Miguel Acosta, Andreas Mueller, Emi Nakamura and Jón Steinsson

No 31784, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We study the macroeconomic effects of unemployment insurance (UI) benefit extensions in the United States at short and long durations. To do this, we develop a new state level dataset on trigger variables for UI extensions and a “UI Benefits Calculator” based on detailed legislative and administrative sources spanning five decades. Our identification approach exploits variation across states in the options governing the Extended Benefits program. We find that UI extensions during time periods when UI benefit durations are already long—such as in the Great Recession—have minimal effects. However, UI extensions at shorter initial durations have substantial effects on the unemployment rate and the number of people receiving UI, with larger estimates during Covid. We relate our estimates to microeconomic estimates of the effects of UI extensions through the lens of partial and general equilibrium models.

JEL-codes: E2 J6 (search for similar items in EconPapers)
Date: 2023-10
New Economics Papers: this item is included in nep-dge and nep-lab
Note: EFG LS ME PE
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Related works:
Working Paper: Macroeconomic Effects of UI Extensions at Short and Long Durations (2023)
Working Paper: Macroeconomic Effects of UI Extensions at Short and Long Durations (2023)
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