A key question in labor market research is how the unemployment insurance system affects unemployment rates and labor market dynamics. We revisit this old question studying the German Hartz reforms. On average, lower separation rates explain 76% of declining unemployment after the reform, a fact...

This paper investigates the effectiveness of benefit sanctions in reducing unemployment duration. Data from the Swiss labor market allow making a distinction between the effect of a warning that a person is not complying with eligibility requirements and the effect of the actual enforcement of a...

This paper provides a novel justification for a declining time profile of unemployment benefits that does not rely on moral hazard or consumption-smoothing considerations. We consider a simple search environment with homogeneous workers and low- and high-productivity firms. By introducing a...

Swiss policy makers created a unique link between unemployment benefits and Active Labor Market Programs (ALMPs) by making benefit payments conditional on program attendance after 7 months of unemployment duration. We evaluate the effect of Active Labor Market Programs and benefit entitlement on...

This paper analyzes the design of optimal unemployment insurance in a search equilibrium framework where search effort among the unemployed is not perfectly observable. We examine to what extent the optimal policy involves monitoring of search effort and benefit sanctions if observed search is...

This paper provides a comprehensive evaluation of benefit sanctions, i.e. temporary reductions in unemployment benefits as punishment for noncompliance with eligibility requirements. In addition to the effects on unemployment durations, we evaluate the effects on post-unemployment employment...

This study examines the determinants of job-finding rates of unemployment benefit recipients under the Chilean program. This is a unique, innovative program that combines social insurance through a solidarity fund (SF) with self-insurance in the form of unemployment insurance savings accounts...

We study how changes in the maximum benefit duration affect the inflow into unemployment in the Netherlands. Until August 2003, workers who became unemployed after age 57.5 were entitled to unemployment benefits until the age of 65, after which they would receive old age pensions. This...

With the emergence of the Great Recession unemployment insurance (UI) is once again at the heart of the policy debate. In this paper, we review the recent theoretical and empirical evidence on the labor market effects of UI design. We also discuss policy issues related to UI design, including...

Unemployment insurance recipients in the Netherlands were for a long time exempted from the requirement to actively search for a job when they reached the age of 57.5. We study how this exemption affected the job finding rates of the recipients involved. We find evidence that the job finding...