recessions. First, we show that the consumption risk of short-time work is considerably smaller compared to unemployment using … risk of workers, which mitigates their precautionary savings motive. Using a quantitative model analysis, we show that this … frictions featuring an endogenous firing and short-time work decision. In recessions, short-time work reduces the unemployment …

In this paper we analyze the relationship between unemployment and consumption. We study this relationship with panel … empirical results indicate that an increase in the duration of unemployment spells of male household heads is associated with … Mediterranean, provide a fundamental source of insurance against unemployment in southern Europe. …

In this paper we consider a risk averse worker who is moving back and forth between employment and unemployment … characterize the worker s optimal savings and job-search behavior as well as the resulting consumption paths and wealth formation … wealth decreases, a finding which is in accordance with our empirical duration analysis using micro data on unemployment …

The issue of whether unemployment benefits should increase or decrease over the unemployment spell is analyzed in an … analytically tractable model allowing moral hazard, adverse selection and hidden savings. Analytical results show that when the … search productivity of unemployed is constant over the unemployment spell, benefits should typically increase or be constant …

Recent theoretical work shows that precautionary savings increase in response to an increase in first-order risk. In … welfare effect of future income uncertainty. We build a model of remittances and savings under income uncertainty and show … that an immigrant will increase his remittances in response to a first-order risk decrease in future income. Using changes …

How does risk affect saving? Empirical work typically examines the effects of detectible differences in risk within the … data. How these differences affect saving in theoretical models depends on the metric one uses for risk. For labor …-income risk, second-degree increases in risk require prudence to induce increased saving demand. However, prudence is not …

selfʺ emerges when labor supply and savings decisions are made. The social welfare function is paternalistic: the rate of … show that the paternalistic solution does not necessarily imply forced savings for the myopics. This is because …