American Economic Journal:
Economic Policy
ISSN 1945-7731 (Print) | ISSN 1945-774X (Online)
Revisiting the Effects of Unemployment Insurance Extensions on Unemployment: A Measurement-Error-Corrected Regression Discontinuity Approach
American Economic Journal: Economic Policy
vol. 12,
no. 2, May 2020
(pp. 84–114)
Abstract
This study documents two potential biases in recent analyses of UI benefit extensions using boundary-based identification: bias from using county-level aggregates and bias from across-border policy spillovers. To examine the first bias, the analysis uses a regression discontinuity approach that accounts for measurement error in county-level aggregates. These results suggest much smaller effects than previous studies, casting doubt on the applicability of border-based designs. The analysis then shows substantial spillover effects of UI benefit duration on across-border work patterns, consistent with increased tightness in high-benefit states and providing evidence against a dominant vacancy reduction response to UI extensions.Citation
Dieterle, Steven, Otávio Bartalotti, and Quentin Brummet. 2020. "Revisiting the Effects of Unemployment Insurance Extensions on Unemployment: A Measurement-Error-Corrected Regression Discontinuity Approach." American Economic Journal: Economic Policy, 12 (2): 84–114. DOI: 10.1257/pol.20160439Additional Materials
JEL Classification
- E24 Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
- E32 Business Fluctuations; Cycles
- J22 Time Allocation and Labor Supply
- J64 Unemployment: Models, Duration, Incidence, and Job Search
- J65 Unemployment Insurance; Severance Pay; Plant Closings
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