In this paper, I revisit the central trade-off between insurance and incentives in the design of unemployment insurance policies. The generosity of unemployment insurance benefits differs not only across countries, but also across workers within countries. After illustrating some important dimensions of heterogeneity in a cross-country analysis, I extend the standard Baily–Chetty formula to identify the key empirical moments and elasticities required to evaluate the differentiated unemployment policy within a country. I also review some prior work and aim to provide guidance for future work trying to inform the design of unemployment policies.
Authors
Research Fellow London School of Economics
Johannes is a Research Fellow at the IFS, a Co-Editor at the Journal of Public Economics and an Associate Professor in Economics at the LSE.
Journal article details
- DOI
- 10.1111/1475-5890.12199
- Publisher
- Wiley
- Issue
- Volume 41, Issue 1, May 2020, pages 101-127
Suggested citation
Spinnewijn, J. (2020). 'The Trade-Off between Insurance and Incentives in Differentiated Unemployment Policies' , 41(1/2020), pp.101–127.
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