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Voluntary income sharing and the design of unemployment insurance

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  • Dan Anderberg

Abstract

This paper uses a model of search unemployment to discuss the interaction between publicly provided insurance and informal insurance through voluntary income sharing, e.g., between spouses. Income sharing reduces the optimal level of public unemployment insurance. While it is always individually rational for partners to share income, the effect of voluntary income sharing on welfare will be negative unless partners can either observe each other's search behavior or are sufficiently altruistic towards each other. The model is also used to examine a family-based policy. The welfare gains from using such policy are argued to be small. Copyright Springer-Verlag Berlin Heidelberg 2003

Suggested Citation

  • Dan Anderberg, 2003. "Voluntary income sharing and the design of unemployment insurance," Journal of Population Economics, Springer;European Society for Population Economics, vol. 16(1), pages 71-90, February.
    • Handle: RePEc:spr:jopoec:v:16:y:2003:i:1:p:71-90
    DOI: 10.1007/s001480200121
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    1. El Lahga, AbdelRahmen & Moreau, Nicolas, 2007. "Would you Marry me? The Effects of Marriage on German Couples? Allocation of Time," ZEW Discussion Papers 07-024, ZEW - Leibniz Centre for European Economic Research.
    2. El Lahga, Abdel Rahmen & Moreau, Nicolas, 2007. "The Effects of Marriage on Couples’ Allocation of Time Between Market and Non-Market Hours," IZA Discussion Papers 2619, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    JEL classification: H11; H31; J68; Key words: Income sharing; unemployment insurance; altruism;
    All these keywords.

    JEL classification:

    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy

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