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Is Unemployment Insurance Addictive? Evidence from the Benefit Durations of Repeat Users

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  • Miles Corak

Abstract

The author finds evidence that the past occurrence of a spell of insured unemployment lengthens the duration of future spells. Descriptive statistics from Canadian administrative data covering mid-1971 to early 1990 suggest that unemployment insurance (UI) claimants tend to spend a longer and longer time collecting benefits with each additional claim they make. This finding contradicts the implication of static neoclassical models that successive UI spells should be of the same length. The author hypothesizes that the stigma attached to receiving unemployment benefits erodes with each new UI claim an individual files.

Suggested Citation

  • Miles Corak, 1993. "Is Unemployment Insurance Addictive? Evidence from the Benefit Durations of Repeat Users," ILR Review, Cornell University, ILR School, vol. 47(1), pages 62-72, October.
    • Handle: RePEc:sae:ilrrev:v:47:y:1993:i:1:p:62-72
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    Cited by:

    1. Colin Busby & David Gray, 2016. "Unequal Access: Making Sense of EI Eligibility Rules and How to Improve Them," C.D. Howe Institute Commentary, C.D. Howe Institute, issue 450, May.
    2. Miles Corak & Wen-Hao Chen, 2007. "Firms, Industries, and Unemployment Insurance: An Analysis using Employer–Employee Data," Research in Labor Economics, in: Aspects of Worker Well-Being, pages 299-336, Emerald Group Publishing Limited.
    3. Corak, Miles & Gustafsson, Björn Anders & Österberg, Torun, 2000. "Intergenerational Influences on the Receipt of Unemployment Insurance in Canada and Sweden," IZA Discussion Papers 184, Institute of Labor Economics (IZA).
    4. David Gray & Ted McDonald, 2012. "Does the sophistication of use of unemployment insurance evolve with experience?," Canadian Journal of Economics, Canadian Economics Association, vol. 45(3), pages 1220-1245, August.
    5. Chen, Wen-Hao & Corak, Miles, 2005. "Entreprises, industries et assurance-chomage : une analyse des donnees sur les employeurs et les employes recueillies au Canada," Direction des études analytiques : documents de recherche 2005260f, Statistics Canada, Direction des études analytiques.
    6. Chen, Wen-Hao & Corak, Miles, 2005. "Firms, Industries, and Unemployment Insurance: An Analysis Using Employer-employee Data from Canada," Analytical Studies Branch Research Paper Series 2005260e, Statistics Canada, Analytical Studies Branch.
    7. Choi, HwaJung & Shin, Donggyun, 2002. "Do past unemployment spells affect the duration of current unemployment?," Economics Letters, Elsevier, vol. 77(2), pages 157-161, October.

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