scholarly journals Fiscal Externalities and Optimal Unemployment Insurance

2017 ◽  
Vol 9 (4) ◽  
pp. 281-312 ◽  
Author(s):  
Nicholas Lawson
Keyword(s):  
Unemployment Insurance ◽  
Job Search ◽  
Government Spending ◽  
Negative Impact ◽  
Common Finding ◽  
Search Model ◽  
Replacement Rate ◽  
Sufficient Statistics ◽  
Optimal Replacement ◽  
Fiscal Externalities

A common finding of the optimal unemployment insurance (UI) literature is that the optimal replacement rate is around 50 percent; however, a key assumption is that UI is the only government spending activity. I show that optimal UI levels may be dramatically reduced when UI is a small part of overall spending: the negative impact of UI on income tax revenues implies added welfare costs, a mechanism that I call a fiscal externality. Using both a standard calibrated structural job search model and a “sufficient statistics” method, I find that the optimal replacement rate is zero when fiscal externalities are incorporated. (JEL E24, H24, J64, J65)

scholarly journals A Macroeconomic Approach to Optimal Unemployment Insurance: Theory

2018 ◽  
Vol 10 (2) ◽  
pp. 152-181 ◽  
Author(s):  
Camille Landais ◽  
Pascal Michaillat ◽  
Emmanuel Saez
Keyword(s):  
Labor Market ◽  
Unemployment Insurance ◽  
Job Search ◽  
Correction Term ◽  
Replacement Rate ◽  
Efficient Level ◽  
Matching Models

This paper develops a theory of optimal unemployment insurance (UI) in matching models. The optimal UI replacement rate is the conventional Baily-Chetty replacement rate, which solves the tradeoff between insurance and job-search incentives, plus a correction term, which is positive when an increase in UI pushes the labor market tightness toward its efficient level. In matching models, most wage mechanisms do not ensure efficiency, so tightness is generally inefficient. The effect of UI on tightness depends on the model: increasing UI may raise tightness by alleviating the rat race for jobs or lower tightness by increasing wages through bargaining. (JEL E24, J22, J23, J31, J41, J64, J65)

scholarly journals On the Provision of Unemployment Insurance when Workers are Ex-Ante Heterogeneous

2020 ◽  
Author(s):  
Ofer Setty ◽  
Yaniv Yedid-Levi
Keyword(s):  
Unemployment Insurance ◽  
Incomplete Markets ◽  
Replacement Rate ◽  
Market Outcomes ◽  
Optimal Replacement ◽  
Maximum Benefit ◽  
Skill Groups ◽  
Optimal Average ◽  
Taxation System

Abstract Labor market outcomes demonstrate considerable variation between and within skill groups. We construct a general equilibrium model with incomplete markets and exogenous differences that matches these facts. We study the role of exogenous heterogeneity in choosing the optimal replacement rate and the maximum benefit for an unemployment insurance (UI) system. The optimal average replacement rate is 27%, compared to 0% in a model without exogenous heterogeneity. The relatively generous choice is due to the redistributive role of UI, which is a manifestation of two elements. First, workers who are unemployed more often receive positive net transfers from the UI system because they draw resources more frequently. Second, the existence of a cap on benefits makes UI progressive. Our main result holds in the presence of a generous progressive taxation system.

An Empirical Equilibrium Job Search Model With Search on the Job and Heterogeneous Workers and Firms

1999 ◽  
Vol 40 (4) ◽  
pp. 1039-1074 ◽  
Author(s):  
Christian Bontemps ◽  
Jean-Marc Robin ◽  
Gerard J. Van den Berg
Keyword(s):  
Job Search ◽  
Search Model

scholarly journals Searching For Better Prospects: Endogenizing Falling Job Tenure and Private Pension Coverage

2006 ◽  
Vol 6 (1) ◽  
Author(s):  
Leora Friedberg ◽  
Michael T Owyang ◽  
Tara M Sinclair
Keyword(s):  
Job Search ◽  
Search Costs ◽  
Private Pension ◽  
Search Model ◽  
Defined Benefit ◽  
Job Tenure ◽  
Relative Wages ◽  
Pension Coverage ◽  
New Evidence ◽  
General Conditions

Abstract Recent declines in job tenure have coincided with a shift away from traditional defined benefit (DB) pensions, which reward long tenure. New evidence also points to an increase in job-to-job movements by workers, and we document gains in relative wages of job-to-job movers over a similar period. We develop a search model in which firms may offer tenure-based contracts like DB pensions to reduce the incidence of costly on-the-job search by workers. Either reduced search costs or an increase in the probability of job matches can, under fairly general conditions, lower the value of deterring search and the use of DB pensions.

scholarly journals ANALISIS DETERMINASI PERTUMBUHAN EKONOMI PROVINSI JAMBI

2018 ◽  
Vol 2 (1) ◽  
pp. 1
Author(s):  
Ali Fahmi
Keyword(s):  
Economic Growth ◽  
Government Spending ◽  
Capital Investment ◽  
Time Series Data ◽  
Negative Impact ◽  
Positive Impact ◽  
Least Square ◽  
Series Data ◽  
Ordinary Least Square ◽  
Investment Capital

This research aims to analyze the effect of government spending, investment of foreign capital investment, capital investment In Land and labor against growth of Jambi province during the 2004-2015. This research using Time Series data with regression analysis "Ordinary Least Square (OLS) wear EViews 8.  The findings from this research indicate that Labor become the most variable gives a positive impact against the next economic growth, government spending and investment, while investing PMDN PMA gives negative impact on The Economic Growth Of The Province Of Jambi. PMA investment posit no impact and no signikan against economic growth this is not prevalent, but it is possible the investment PMA in Jambi province is relatively small and still no impact in the absorption of the local Workforce. Menyikapai is an effort to boost the Economic growth of the Province of Jambi then needed a special business development policies should be directed at the activities that are labor-intensive to absorb labor as much as possible. Keywords: economic growth, government spending, PMA, the PMDN, and labor.

scholarly journals Are Sufficient Statistics Necessary? Nonparametric Measurement of Deadweight Loss from Unemployment Insurance

2019 ◽  
Author(s):  
David Lee ◽  
Pauline Leung ◽  
Christopher J. O'Leary ◽  
Zhuan Pei ◽  
Simon Quach
Keyword(s):  
Unemployment Insurance ◽  
Deadweight Loss ◽  
Sufficient Statistics
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