Benefit Duration, Unemployment Duration and Job Match Quality: A Regression-Discontinuity Approach
By Marco Caliendo, Konstantinos Tatsiramos, Arne Uhlendorff. Social Science Research Network, 2009
224 citations recorded by the source corpus.
The generosity of the Unemployment Insurance system (UI) plays a central role for the job search behavior of unemployed individuals. Standard search theory predicts that an increase in UI benefit generosity, either in terms of benefit duration or entitlement, has a negative impact on the job search activities of the unemployed increasing their unemployment duration. Despite the disincentive effect of UI on unemployment duration, UI benefit generosity may also increase job match quality by allowing individuals to wait for better job offers. In this paper we use a sharp discontinuity in the maximum duration of unemployment benefits in Germany, which increases from 12 months to 18 months at the age of 45, to identify the effect of extended benefit duration on unemployment duration and post-unemployment outcomes. We find a spike in the re-employment hazard for the unemployed workers with 12 months benefit duration, which occurs around benefit exhaustion. This leads to lower unemployment duration compared to their counterparts with 18 months benefit duration. However, we also show that those unemployed who obtain jobs close to and after the time when benefits are exhausted are significantly more likely to exit subsequent employment and receive lower wages compared to their counterparts with extended benefit duration.
Subfields: Economics and Econometrics, Gender Studies, General Health Professions
View Paper: https://www.semanticscholar.org/paper/0a791b04543c40cdd0939da9c4df80ccb912c1c5
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In Economics and Econometrics
Citations in the corpus
- Does Extending Unemployment Benefits Improve Job Quality? (2017, unknown): “…use an out-of-sample prediction of benefit exhaustion, based on a non-parametric regression of ex-ante characteristics of 19For other investigation of the UI effect on search decisions conditional on unemployment duration see Centeno and Novo (2011), Caliendo et al. (2013), Schmieder et al. (2014).”
- Using a Regression Discontinuity Design to Estimate the Impact of Placement Decisions in Developmental Math (2015, methodology): “Our study estimates the impact of placement decisions in the preparatory math sequence over time by using a discrete-time hazard model (Singer and Willett 1993, 2003) within a RDD framework (Caliendo et al. 2013; Ham and LaLonde 1996; Lesik 2007).”