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The effect of receiving supplementary UI benefits on unemployment duration

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  • Kyyrä, Tomi
  • Parrotta, Pierpaolo
  • Rosholm, Michael

Abstract

We consider the consequences of working part-time on supplementary unemployment insurance benefits in the Danish labour market. Following the 'timing-of-events' approach we estimate causal effects of subsidized part-time work on the hazard rate out of unemployment insurance benefit receipt. We find evidence of a negative lock-in effect and a positive post-treatment effect, both of which vary across individuals. The resulting net effect on the expected unemployment duration is positive for some groups (e.g. married women) and negative for others (e.g. young workers).

Suggested Citation

  • Kyyrä, Tomi & Parrotta, Pierpaolo & Rosholm, Michael, 2009. "The effect of receiving supplementary UI benefits on unemployment duration," Working Papers 1, VATT Institute for Economic Research.
    • Handle: RePEc:fer:wpaper:1
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    References listed on IDEAS

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    More about this item

    Keywords

    Unemployment benefits; part-time work; lock-in effect; treatment effect; duration analysis; Labour market; Työmarkkinat; Social security; Sosiaaliturva; Labor market and policies promoting economic growth; Työmarkkinat ja kasvua tukeva politiikka; C410 - Duration Analysis; J650 - Unemployment Insurance; Severance Pay; Plant Closings;
    All these keywords.

    JEL classification:

    • C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies
    • J65 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment Insurance; Severance Pay; Plant Closings

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