Does Extending Unemployment Benefits Improve Job Quality?

Abstract

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Estimating the Effects of Potential Benefit Duration Without Variation in the Maximum Duration of Unemployment Benefits

“…This nding is in line with the studies by Centeno and Novo (2009) and Nekoei and Weber (2017), which nd small positive eects on re-employment wages in Portugal and Austria, respectively. On the other hand, most other studies, such as Lalive (2007) and Card et al (2007) for Austria, Le Barbanchon (2016) for France, and Schmieder et al (2016) for Germany, nd negative or no eects of longer benet duration on match quality.…”

A Contribution to the Empirics of Reservation Wages

“…19 As is evident from the graph, the cross-sectional distribution of the reservation wage ratios is close to log normal, and the mean of the log of the ratio is 0.07 and the standard deviation is 0.37. 20 Nearly 80 percent of newly unemployed workers reported a reservation wage ratio above 0.75, the optimal level from our calibrated model, suggesting either overly optimistic expectations or systematic misreporting of reservation wages.…”

“…This trimming procedure caused us to exclude 2,692 observations out of a total of 36,514 observations with information on the reservation wage. 19 To gain further insights into the determinants of the reservation wages, Appendix Table A1 provides some…”

The Effect of Unemployment Benefits and Nonemployment Durations on Wages

“…In contrast,Nekoei and Weber (2015) find a larger spike in wages at UI exhaustion that induces a slight positive overall effect of UI extensions on wages. This may be related to the fact that the UI extensions studied by Nekoei and Weber occur much earlier in the spell where individuals may be more responsive.…”

“…SeeChetty (2008) and Schmieder, von Wachter, and Bender (2012a) for details Nekoei and Weber (2015). show that foregone tax revenues from lower earnings can also play a role.…”