Arbeitspapier

Benefit duration, job search behavior and re-employment

to connected objects

This paper studies how the potential duration of unemployment benefits affects early job search behavior and re-employment outcomes. We exploit an unexpected reform of the German unemployment insurance (UI) scheme in 2008, which increased the potential benefit duration from 12 to 15 months for benefit recipients of age 50 to 54. Based on detailed survey data and a difference-in-differences design, we estimate that one additional month of potential benefits reduces early job applications by around 10%. Using social security data, we further find that the extension of benefits increases the average nonemployment duration of individuals entering UI after the reform. Among individuals who got treated at later stages of their unemployment spell, the increased UI coverage does not appear to come at the cost of longer nonemployment. A cautious back-of-the-envelope calculation reveals substantial job funding returns to early search effort.

Language: Englisch

Bibliographic citation: Series: ECONtribute Discussion Paper ; No. 037

Classification: Wirtschaft
Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
Welfare, Well-Being, and Poverty: Government Programs; Provision and Effects of Welfare Programs
Unemployment: Models, Duration, Incidence, and Job Search
Mobility, Unemployment, and Vacancies: Public Policy

Subject: Unemployment Insurance
Job Search
Re-Employment Outcomes
Natural Experiment

Event: Geistige Schöpfung

(who): Lichter, Andreas
Schiprowski, Amelie

Event: Veröffentlichung

(who): University of Bonn and University of Cologne, Reinhard Selten Institute (RSI)

(where): Bonn and Cologne

(when): 2020

Handle: http://hdl.handle.net/10419/226837

Last update: 10.03.2025, 11:45 AM CET

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Object type

Arbeitspapier

Associated

Lichter, Andreas
Schiprowski, Amelie
University of Bonn and University of Cologne, Reinhard Selten Institute (RSI)

Time of origin

2020

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