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The differential impact of unemployment insurance on unemployment duration by income level

James J. Hughes (University of Kent, Canterbury, UK)
James Peoples (University of Wisconsin‐Milwaukee, Milwaukee, USA)
Richard Perlman (University of Wisconsin‐Milwaukee, Milwaukee, USA)

International Journal of Manpower

ISSN: 0143-7720

Article publication date: 1 March 1996

Abstract

While there is a vast literature on the effect of unemployment insurance on unemployment duration, in almost all of these studies the replacement ratio is the key explanatory variable. Does not contest the almost universal findings that the higher the ratio of unemployment income to that of previous earnings, the longer is unemployment duration, but finds that when pre‐unemployment income itself is considered, duration is positively related to that income. Supports the positive view of the merits of unemployment insurance. While past studies emphasize the leisure aspect, unemployment insurance incorporates the ability to improve search through the use of unemployment insurance funds. This use of funds is particularly applicable to high income recipients.

Keywords

Citation

Hughes, J.J., Peoples, J. and Perlman, R. (1996), "The differential impact of unemployment insurance on unemployment duration by income level", International Journal of Manpower, Vol. 17 No. 2, pp. 18-33. https://doi.org/10.1108/01437729610112349

Publisher

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MCB UP Ltd

Copyright © 1996, MCB UP Limited