Abstract

http://ssrn.com/abstract=428343
 
 

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Unemployment Insurance, Recall Expectations, and Unemployment Outcomes


Lawrence F. Katz


Harvard University - Department of Economics; National Bureau of Economic Research (NBER)

Bruce D. Meyer


University of Chicago - Irving B. Harris Graduate School of Public Policy Studies; National Bureau of Economic Research (NBER)

February 1991

NBER Working Paper No. w2594

Abstract:     
This paper shows the importance of explicitly accounting for the possibility of recalls when analyzing the determinants of unemployment spell durations and the effects of unemployment insurance (UI) on unemployment outcomes in the United States. These issues are examined using a unique sample of UI recipients from Missouri and Pennsylvania covering unemployment spells in the 1979- 1981 period. We find that those expecting recall who are not recalled tend to have quite long unemployment spells. Furthermore, ex-ante temporary layoff spells (the spells of individuals' who initially expect to be recalled) may account for over 60 percent of the unemployment of UI recipients and appear to account for much more unemployment than ex-post temporary layoff spells (spells actually ending in recall). We estimate a competing risks model in which the finding of a new job and recall are treated as alternate routes of leaving unemployment. Our results using this approach show that the recall and new job exit probabilities have quite different time patterns and are often affected in opposite ways by explanatory variables. We also find that the probability of leaving unemployment (both through recalls and new job finding) increases greatly around the time that UI benefits lapse.

Number of Pages in PDF File: 59

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Date posted: July 5, 2004  

Suggested Citation

Katz, Lawrence F. and Meyer, Bruce D., Unemployment Insurance, Recall Expectations, and Unemployment Outcomes (February 1991). NBER Working Paper No. w2594. Available at SSRN: http://ssrn.com/abstract=428343

Contact Information

Lawrence F. Katz (Contact Author)
Harvard University - Department of Economics ( email )
Littauer Center
Room 215
Cambridge, MA 02138
United States
617-495-5148 (Phone)
617-868-2742 (Fax)
HOME PAGE: http://www.economics.harvard.edu/faculty/katz/katz
National Bureau of Economic Research (NBER) ( email )
1050 Massachusetts Avenue
Cambridge, MA 02138
United States
Bruce D. Meyer
University of Chicago - Irving B. Harris Graduate School of Public Policy Studies ( email )
1155 East 60th Street
Chicago, IL 60637
United States
(773) 702-2712 (Phone)
National Bureau of Economic Research (NBER)
1050 Massachusetts Avenue
Cambridge, MA 02138
United States
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