The Effect of Unemployment Insurance on Unemployment: The Case of Federal Supplemental Benefits

Moffitt, Robert A.; Nicholson, Walter

doi:10.2307/1937937

Cited by 179 publications

(118 citation statements)

References 9 publications

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“…The rationale for UI to increase physical activity is tied to the expectation that unemployment benefits lengthen unemployment duration by distorting job search incentives and subsidizing leisure time, with the strongest effects among liquidity constrained households (Chetty 2008;Moffitt and Nicholson 1982;Mortensen 1977). …”

Section: Literature Reviewmentioning

confidence: 99%

“…While UI programs are not designed specifically to promote healthy behaviors, it is well established that UI reduces the opportunity cost of leisure (Chetty 2008;Moffitt and Nicholson 1982;Mortensen 1977). Although sedentary and physically active leisure are both subsidized by UI, economic theory posits that demand for time-intensive, health promoting activities will increase as the price of engaging in these activities decreases.…”

Section: Introductionmentioning

confidence: 99%

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Unemployment Insurance and Physical Activity

Cylus¹

2017

Human Capital and Health Behavior

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Unemployment insurance (UI) reduces the opportunity cost of leisure, but it is unknown whether this additional leisure time is physically active. To obtain unbiased estimates of the effect of UI on physically active leisure participation, I exploit changes in UI program legislation across US states and time. Using nationally representative monthly data between 2003 and 2010 from the Behavioral Risk Factor Surveillance System (BRFSS) and the American Time Use Survey (ATUS), I find evidence that both state UI eligibility expansions and increases in maximum allowable state UI benefits coincide with greater probability of physical activity among the recently unemployed. Based on point estimates, state UI eligibility expansions increased the probability of physical activity participation by 8 to 10 percentage points among the unemployed with less than a high school education, while a 10 percent increase in the maximum allowable state UI benefit increased the probability of physical activity by 0.3 to 0.6 percentage points among the unemployed who have completed high school or some college.

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Section: Literature Reviewmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Unemployment Insurance and Physical Activity

Cylus¹

2017

Human Capital and Health Behavior

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“…Among the first was Moffitt and Nicholson (1982), which measured the influence of the total number of weeks of unemployment benefits (regular and EEB) on the fraction of an individual's time spent unemployed. In another early study, Meyer (1990) examined the influence of the number of weeks of benefits remaining for an individual on that individual's propensity to exit UI rolls.…”

Section: Background Literature On Eeb Effectsmentioning

confidence: 99%

“…In another early study, Meyer (1990) examined the influence of the number of weeks of benefits remaining for an individual on that individual's propensity to exit UI rolls. Moffitt and Nicholson (1982) used a nationally representative sample of about 1000 individuals who had received Federal Supplementary Benefits during the mid-1970s, while Meyer (1990) studied administrative UI data from 12 states from [1978][1979][1980][1981][1982][1983][1984]. Both studies had data on the total weeks of UI benefit eligibility by individual and were thus able to take advantage of differences in benefit availability for individuals with different work histories as well as differences in benefits across states and time.…”

Section: Background Literature On Eeb Effectsmentioning

confidence: 99%

How Large were the Effects of Emergency and Extended Benefits on Unemployment during the Great Recession and its Aftermath?

Figura

Ratner

2017

FEDS

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This paper presents estimates of the effect of unemployment benefit extensions during the Great Recession on unemployment and labor force participation. Unlike many recent studies of this subject, our estimates, following the work of Hagedorn, Karahan, Manovskii, and Mitman (2016), are inclusive of the effects of benefit extensions on employer, as well as, worker behavior. To identify the effect of benefit extensions, we use plausibly exogenous changes in the rules governing benefit extensions and their differential effects on the maximum duration of benefits across states. We find that the effect of benefit extensions is likely modest, with a 90 percent confidence interval of the effect on the unemployment rate ranging from 0 to ½ percentage point. JEL classifications: J6, E24.

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“…4 Early studies, including Moffitt and Nicholson (1982), Moffitt (1985), and Grossman (1989) find significantly negative incentive effects. Meyer (1990) and Katz and Meyer (1990) show that the exit rate from unemployment rises sharply just before benefits are exhausted.…”

Section: Empirical Literaturementioning

confidence: 99%

Equilibrium unemployment and the duration of unemployment benefits

2010

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This paper uses microdata to evaluate the impact on the steady-state unemployment rate of an increase in maximum benefit duration. We evaluate a policy change in Austria that extended maximum benefit duration and use this policy change to estimate the causal impact of benefit duration on labor market flows. We find that the policy change leads to a significant increase in the steady-state unemployment rate and, surprisingly, most of this increase is due to an increase in the inflow into rather than the outflow from unemployment. Abstract This paper uses microdata to evaluate the impact on the steady-state unemployment rate of an increase in maximum benefit duration. We evaluate a policy change in Austria that extended maximum benefit duration and use these changes to estimate the causal impact of benefit duration on labor market flows. We find that the the policy change leads to a significant increase in the steady-state unemployment rate and, surprisingly, most of this increase is due to an increase in the inflow into rather than the outflow from unemployment. Lalive is also affiliated with CEPR, CESifo and IZA.

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The Effect of Unemployment Insurance on Unemployment: The Case of Federal Supplemental Benefits

Cited by 179 publications

References 9 publications

Unemployment Insurance and Physical Activity

Unemployment Insurance and Physical Activity

How Large were the Effects of Emergency and Extended Benefits on Unemployment during the Great Recession and its Aftermath?

Equilibrium unemployment and the duration of unemployment benefits

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