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  3. American Economic Review
  4. May 2012
  5. The Long-Term Effects of UI Extensions on Employment

American Economic Review

ISSN 0002-8282 (Print) | ISSN 1944-7981 (Online)

The Long-Term Effects of UI Extensions on Employment

  • Johannes F. Schmieder
  • Till von Wachter
  • Stefan Bender
American Economic Review
vol. 102, no. 3, May 2012
(pp. 514–19)
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Abstract

The majority of papers analyzing the employment effects of unemployment insurance (UI) benefit durations focus on the duration of the first unemployment spell. In this paper, we make two contributions. First, we use a regression discontinuity design to analyze the long-term effects of extensions in UI durations. These estimates differ from standard estimates in that they incorporate differences in UI benefit receipt and employment due to recurrent unemployment spells. Second, we derive a welfare formula of UI extensions that incorporates recurrent nonemployment spells.

Citation

Schmieder, Johannes F., Till von Wachter, and Stefan Bender. 2012. "The Long-Term Effects of UI Extensions on Employment." American Economic Review, 102 (3): 514–19. DOI: 10.1257/aer.102.3.514

JEL Classification

  • E24 Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital
  • J65 Unemployment Insurance; Severance Pay; Plant Closings