This paper estimates the welfare gain (i.e. ratio of liquidity to moral hazard effect) of extending UI benefits, using two natural experiments in Taiwan: a three-month benefits extension for middle-aged job losers and the introduction of a re-employment bonus. Our strategy exploits the fact that...

This paper estimates the liquidity effect and moral hazard effect of extended un- employment insurance (UI) benefits using two natural experiments. In Taiwan, since unemployed workers eligible for unemployment benefits receive 50% of their remaining entitlements if reemployed before they exhaust...