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Unemployment Benefits And Search Behavior An Empirical Investigation

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  • Ridder, Geert
  • Gorter, Kees

Abstract

In this paper we estimate a structural model of the search behaviour of the unemployed. We concentrate on the effect of unemployment benefits on the reservation wage which characterizes the optimal search strategy. We find a larger estimate of the benefit elasticity than that obtained in a comparable study for the United Kingdom. A comparison of the estimation results shows that the difference is due to a smaller arrival rate of job offers which is not accompanied by a lower reservation wage (relative to the wage offer distribution).

Suggested Citation

  • Ridder, Geert & Gorter, Kees, 1986. "Unemployment Benefits And Search Behavior An Empirical Investigation," University of Amsterdam, Actuarial Science and Econometrics Archive 293113, University of Amsterdam, Faculty of Economics and Business.
    • Handle: RePEc:ags:amstas:293113
    DOI: 10.22004/ag.econ.293113
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    Citations

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    Cited by:

    1. Carling, Kenneth & Holmlund, Bertil & Vejsiu, Altin, 2001. "Do Benefit Cuts Boost Job Finding? Swedish Evidence from the 1990s," Economic Journal, Royal Economic Society, vol. 111(474), pages 766-790, October.
    2. John T. Addison & Mário Centeno & Pedro Portugal, 2010. "Unemployment Benefits and Reservation Wages: Key Elasticities from a Stripped‐Down Job Search Approach," Economica, London School of Economics and Political Science, vol. 77(305), pages 46-59, January.
    3. Christensen, Bent Jesper & Kiefer, Nicholas M, 1994. "Measurement Error in the Prototypal Job-Search Model," Journal of Labor Economics, University of Chicago Press, vol. 12(4), pages 618-639, October.
    4. Carling, Kenneth & Edin, Per-Anders & Harkman, Anders & Holmlund, Bertil, 1996. "Unemployment duration, unemployment benefits, and labor market programs in Sweden," Journal of Public Economics, Elsevier, vol. 59(3), pages 313-334, March.
    5. Yann Algan & Antoine Terracol, 2001. "L'influence de l'épargne de précaution sur la recherche d'emploi," Économie et Statistique, Programme National Persée, vol. 349(1), pages 63-76.
    6. John W. Schindler, 2001. "Testing optimality in job search models," International Finance Discussion Papers 710, Board of Governors of the Federal Reserve System (U.S.).
    7. Yann Algan & Antoine Terracol, 2001. "L'influence de l'épargne de précaution sur la recherche d'emploi," Post-Print hal-01017893, HAL.

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