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Unemployment insurance, unemployment durations and re-employment wages

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  • McCall, Brian
  • Chi, Wei

Abstract

We develop an empirical model to estimate the impact of UI on unemployment duration and re-employment wages. The model estimates the UI receipt, unemployment duration and re-employment wage equations simultaneously, incorporates unobserved heterogeneity variables in each equation and allows them to be correlated. The NLSY79 data is used to estimate the model. Some results are found in support of the positive effect of UI on re-employment wages.

Suggested Citation

  • McCall, Brian & Chi, Wei, 2008. "Unemployment insurance, unemployment durations and re-employment wages," Economics Letters, Elsevier, vol. 99(1), pages 115-118, April.
    • Handle: RePEc:eee:ecolet:v:99:y:2008:i:1:p:115-118
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    1. Meyer, Bruce D, 1990. "Unemployment Insurance and Unemployment Spells," Econometrica, Econometric Society, vol. 58(4), pages 757-782, July.
    2. Addison, John T. & Blackburn, McKinley L., 2000. "The effects of unemployment insurance on postunemployment earnings," Labour Economics, Elsevier, vol. 7(1), pages 21-53, January.
    3. Devine, Theresa J. & Kiefer, Nicolas M., 1991. "Empirical Labor Economics: The Search Approach," OUP Catalogue, Oxford University Press, number 9780195059366.
    4. Ham, John C & Rea, Samuel A, Jr, 1987. "Unemployment Insurance and Male Unemployment Duration in Canada," Journal of Labor Economics, University of Chicago Press, vol. 5(3), pages 325-353, July.
    5. Card, David & Levine, Phillip B., 2000. "Extended benefits and the duration of UI spells: evidence from the New Jersey extended benefit program," Journal of Public Economics, Elsevier, vol. 78(1-2), pages 107-138, October.
    6. Fallick, Bruce Chelimsky, 1991. "Unemployment Insurance and the Rate of Re-employment of Displaced Workers," The Review of Economics and Statistics, MIT Press, vol. 73(2), pages 228-235, May.
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    Cited by:

    1. Simoes, Nadia, 2013. "Subsídio de desemprego: uma revisão da literatura teórica e empírica [Unemployment insurance: a survey]," MPRA Paper 52332, University Library of Munich, Germany.
    2. Bart Cockx & Matteo Picchio, 2013. "Scarring effects of remaining unemployed for long-term unemployed school-leavers," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 176(4), pages 951-980, October.
    3. Ivana Malá & Adam Èabla, 2022. "Modelling of the Unemployment Duration in the Czech Republic Based on Aggregated Complete and Individual Censored Data," Journal of Economics / Ekonomicky casopis, Institute of Economic Research, Slovak Academy of Sciences, vol. 70(2), pages 171-187, January.
    4. Stefan Arent & Wolfgang Nagl, 2011. "Löhne und Arbeitslosengeld: Wie haben sich die HARTZ-Reformen auf die Lohnentwicklung ausgewirkt?," ifo Dresden berichtet, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 18(03), pages 03-07, June.
    5. Stephanie Lluis & Brian McCall, 2017. "Part-Time Work and Crowding-Out Implications of Employment Insurance Pilot Initiatives," Working Papers 1701, University of Waterloo, Department of Economics, revised Jan 2017.
    6. Jahn, Elke J. & Rosholm, Michael, 2014. "Looking beyond the bridge: The effect of temporary agency employment on labor market outcomes," European Economic Review, Elsevier, vol. 65(C), pages 108-125.
    7. Mattia Filomena, 2021. "Unemployment Scarring Effects: A Symposium On Empirical Literature," Working Papers 453, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
    8. Nazarov, Zafar, 2018. "The effect of the unemployment insurance wage replacement rate on reemployment wages: A dynamic discrete time hazard model with unobserved heterogeneity," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 52, pages 91-109.
    9. Lachowska, Marta & Meral, Merve & Woodbury, Stephen A., 2016. "Effects of the unemployment insurance work test on long-term employment outcomes," Labour Economics, Elsevier, vol. 41(C), pages 246-265.
    10. Stefan Arent & Wolfgang Nagl, 2011. "Unemployment Benefit and Wages: The Impact of the Labor Market Reform in Germany on (Reservation) Wages," ifo Working Paper Series 101, ifo Institute - Leibniz Institute for Economic Research at the University of Munich.
    11. Wolfgang Nagl & Stefan Arent, 2012. "Unemployment Benefits and Wages: Evidence from the German Hartz-Reform," ERSA conference papers ersa12p78, European Regional Science Association.
    12. Arent Stefan & Nagl Wolfgang, 2013. "Unemployment Compensation and Wages: Evidence from the German Hartz Reforms," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 233(4), pages 450-466, August.
    13. Gaure, Simen & Røed, Knut & Westlie, Lars, 2012. "Job search incentives and job match quality," Labour Economics, Elsevier, vol. 19(3), pages 438-450.
    14. Wolfgang Nagl, 2014. "Lohnrisiko und Altersarmut im Sozialstaat," ifo Beiträge zur Wirtschaftsforschung, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, number 54.
    15. Zafar Nazarov, 2010. "The Effect of the UI Wage Replacement Rate on Reemployment Wages A Dynamic Discrete Time Hazard Model with Unobserved Heterogeneity," Working Papers WR-734, RAND Corporation.

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