Improving Incentives in Unemployment Insurance: A Review of Recent Research

36 Pages Posted: 23 Apr 2003

See all articles by Peter Fredriksson

Peter Fredriksson

IZA Institute of Labor Economics; CESifo (Center for Economic Studies and Ifo Institute); Uppsala University - Department of Economics

Bertil Holmlund

Uppsala University - Department of Economics; CESifo (Center for Economic Studies and Ifo Institute); IZA Institute of Labor Economics

Multiple version iconThere are 2 versions of this paper

Date Written: April 2003

Abstract

This paper provides a review of the recent literature on how incentives in unemployment insurance (UI) can be improved. We are particularly concerned with three instruments, viz. the duration of benefit payments (or more generally the time sequencing of benefits), monitoring in conjunction with sanctions, and workfare. Our reading of the theoretical literature is that the case for imposing a penalty on less active job search is fairly solid. A growing number of empirical studies, including randomized experiments, are in line with this conclusion.

Keywords: Unemployment Insurance, Search, Monitoring, Sanctions, Workfare

JEL Classification: J64, J65, J68

Suggested Citation

Fredriksson, Peter and Holmlund, Bertil, Improving Incentives in Unemployment Insurance: A Review of Recent Research (April 2003). CESifo Working Paper Series No. 922; Uppsala University, Department of Economics Working Paper No. 2003:10. Available at SSRN: https://ssrn.com/abstract=396504

Peter Fredriksson

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Uppsala University - Department of Economics ( email )

SE-75120 Uppsala
Sweden
+46 18 471 7079 (Phone)
+46 18 471 1478 (Fax)

Bertil Holmlund (Contact Author)

Uppsala University - Department of Economics ( email )

SE-75120 Uppsala
Sweden
+46 18 471 1122 (Phone)
+46 18 471 1478 (Fax)

HOME PAGE: http://www.nek.uu.se/faculty/holmlund/index.html

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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