' incentives to create jobs, increases unemployment, and lowers GDP. To quantify the effects of this novel channel, we extend the … counterfactual exercises. We find that the adverse effects of our mechanism on the economy's TFP, GDP, and unemployment are sizable. …

In many search models of the labor market, unemployment insurance (UI) is conveniently interpreted as the value of … two equilibrium models of unemployment: random search and directed search. In a random search model without taxes … can be internalized and efficiency can be re-established. -- directed search ; random search ; unemployment insurance …

. Consequently, entrant workers have lower job-finding rates and longer unemployment durations than the unemployed who have looked …