The Effects of Taxing Unemployment Insurance Benefits Accounting For Induced Labor Supply Responses

1988 ◽  
pp. 149-167
Author(s):  
David M. Betson ◽  
Jennifer L. Warlick ◽  
Timothy M. Smeeding
Keyword(s):  
Labor Supply ◽  
Unemployment Insurance ◽  
Induced Labor ◽  
Insurance Benefits

The Labor Supply Consequences of Employment-Limiting Social Insurance Benefits: New Tests for Income Effects

2011 ◽  
Vol 11 (1) ◽  
Author(s):  
Henry R Hyatt
Keyword(s):  
Labor Supply ◽  
Unemployment Insurance ◽  
Social Insurance ◽  
Workers Compensation ◽  
Payroll Tax ◽  
Insurance Benefits ◽  
Income Effects ◽  
Price Distortion ◽  
Compensation Claim ◽  
Legislative Changes

Abstract Studies of moral hazard in employment-limiting social insurance programs such as Unemployment Insurance or Workers Compensation have demonstrated that higher benefits discourage work, emphasizing the price distortion inherent in benefit provision. Utilizing administrative data linking Workers’ Compensation claim records to wage records from an Unemployment Insurance payroll tax database, I explore a different explanation and implement tests for “income effects” that exploit the fact that claimants no longer experience a distorted price of non-employment after an employment-limiting benefit ends. A pair of legislative changes to a Workers’ Compensation benefit rate show little or no evidence of income effects and moderate evidence of income effects, respectively.

scholarly journals Regional Variations in Cyclical Employment

1984 ◽  
Vol 16 (7) ◽  
pp. 863-877 ◽  
Author(s):  
M I Howland
Keyword(s):  
Labor Force ◽  
Unemployment Insurance ◽  
Capital Stock ◽  
Insurance Benefits ◽  
World War 2 ◽  
Short Run ◽  
State Employment ◽  
State Variation ◽  
Industrial Mix ◽  
Employment Decline

In this paper the author develops and tests a model of regional responses to national business-cycles. The model divides cyclical decline in each state into two sectors: a basic sector and a nonbasic sector. The industrial mix, capital—labor ratio, age of capital stock, level of unemployment insurance benefits, labor shortage, and extent of labor-force unionization of a state are hypothesized to influence the response to national recessions by the economy of a state. Employment decline in the nonbasic sector of the economy of a state is a function of employment decline in basic industries and is transmitted through a short-run multiplier. The model is tested on data from five post World War 2 recessions between 1950 and 1975. The findings indicate that industry mix at the two-digit Standard Industrial Code level explains 36% of the across-state variation in cyclical employment. The results also indicate that an old capital-stock, a nonunion labor force, and generous unemployment insurance benefits promote cyclical stability in state economies.

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