Economics, Econometrics and Finance
4 years ago

Longer unemployment benefits lead to longer jobless periods during economic downturns

The Economic Journal
Unemployment Duration, Benefit Duration and the Business Cycle
Olympia Bover, Manuel Arellano, Samuel Bentolila

Paper Summary

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The article explores how the length of unemployment benefits affects how long people stay unemployed during different economic conditions. The researchers studied data to see if longer benefit durations lead to longer unemployment spells. They found that during economic downturns, longer benefit durations can actually increase the time people stay unemployed. This suggests that the relationship between benefit duration and unemployment duration is influenced by the overall state of the economy.