How Do Extended Benefits Affect Unemployment Duration? A Regression Discontinuity Approach

By Rafael Lalive. Social Science Research Network, 2008

377 citations recorded by the source corpus.

This paper studies a program that extends the maximum duration of unemployment benefits from 30 weeks to 209 weeks. Interestingly, this program is targeted to individuals aged 50 years or older, living in certain eligible regions in Austria. In the evaluation, I use sharp discontinuities in treatment assignment at age 50 and at the border between eligible regions and control regions to identify the effect of extended benefits on unemployment duration. Results indicate that the duration of job search is prolonged by at least .09 weeks per additional week of benefits among men, whereas unemployment duration increases by at least .32 weeks per additional week of benefits among women. The salient differences between men and women are consistent with the lower minimum age for early retirement applying to women.

Subfields: Economics and Econometrics, General Health Professions, Statistics and Probability

View Paper: https://www.semanticscholar.org/paper/ac6f52c6ac4cb8dd7a0ce15b4b211c85a011475b

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Citations in the corpus

Labor Market Effects of Unemployment Insurance Design (2014, positive): “Chetty (2008) uses variation in severance pay policies across ﬁrms in the U.S. to identify the eﬀect of liquidity constraints.”
Loss in the Time of Cholera: Long-Run Impact of a Disease Epidemic on the Urban Landscape (2020, background): “21 See Holmes (1998); Black (1999); Kane, Riegg, and Staiger (2006); Lalive (2008); and Dell (2010) for examples of papers employing an RD design with distance to the treatment threshold as the forcing variable.”
Politico-Economic Regimes and Attitudes: Female Workers under State Socialism (2019, methodology): “As recommended by Imbens and Zajonc (2011), we collapse it to one dimension, thus using distance from the border as our running variable (Black, 1999; Lalive, 2008; Schumann, 2014).”
The Demand for Social Insurance: Does Culture Matter? (2011, positive): “(24)Stutzer and Lalive (2004) discuss the political context of this referendum and use this referendum to proxy for the norm to live off one’s own income.”
Electoral rules and voter turnout (2011, neutral): “As discussed by Lee and Lemieux (2009), because of its local randomized experiment nature it is not necessary to include in a RDD setting additional controls to obtain consistent estimates.”
Benefit Duration, Unemployment Duration and Job Match Quality: A Regression-Discontinuity Approach (2009, positive): “More recent evidence based on an RD design is offered by Lalive (2008) using discontinuities in the potential benefit duration at age 50 and across regions in Austria.”
Including Covariates in the Regression Discontinuity Design (2018, methodology): “As acknowledged by Lalive (2008), however, a concern is that employees and companies could manipulate age at entry into unemployment, for example, by postponing a layoff in a way that the age requirement is just satisfied.”