Effects of a higher replacement rate on unemployment durations, employment, and earnings
Journal
Swiss Journal of Economics and Statistics
ISSN
0303-9692
Type
journal article
Date Issued
2015-03-01
Author(s)
Abstract
This paper discusses the effects of a higher unemployment benefit replacement rate on unemployment durations, employment, and earnings. A reform of the Swiss unemployment insurance in July 2003 increased the replacement rate by up to 5.88 ppt for individuals who earned between 3,536 and 4,340 CHF and have no children, while it did not change the replacement rate for all other unemployed persons. This allows to study the effects of a higher replacement rate adopting a difference-in-differences (DiD) approach. The change in the replacement rate increased unemployment durations by 3.1% - or roughly one week - for the treatment group. Women tend to react stronger than men. There is no effect of the level of the replacement rate on employment probabilities or earnings after the unemployment spell is finished.
Language
English
Keywords
unemployment durations
unemployment insurance
replacement rate
post-unemployment outcomes
HSG Classification
contribution to scientific community
Refereed
Yes
Publisher
Lang
Publisher place
Bern
Volume
151
Number
1
Start page
3
End page
25
Pages
23
Subject(s)
Division(s)
Eprints ID
238696
File(s)![Thumbnail Image]()
Name
2015-I-1.pdf
Size
583.33 KB
Format
Adobe PDF
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