Skip to main content
SpringerLink
Log in

Unemployment Insurance

  • Living reference work entry
  • First Online:
The New Palgrave Dictionary of Economics

  • 117 Accesses

Abstract

Unemployment insurance (UI) is a social insurance programme in which compensation is paid to unemployed workers. Much of the research on UI has focused on the inherent disincentives. For example, higher benefits have been found to increase unemployment durations, with little clear positive impact on the quality of new jobs. Additionally, financing UI through payroll taxes that are not completely experience-rated provides an incentive for firms to lay off workers. Thus, while UI is an important safety net for unemployed workers, it may also increase unemployment overall.

This chapter was originally published in The New Palgrave Dictionary of Economics, 2nd edition, 2008. Edited by Steven N. Durlauf and Lawrence E. Blume

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Log in via an institution

Institutional subscriptions

Bibliography

  • Acemoglu, D., and R. Shimer. 1999. Efficient unemployment insurance. Journal of Political Economy 107: 893–928.

    Article  Google Scholar 

  • Anderson, P.M. 1993. Linear adjustment costs and seasonal labor demand: Evidence from retail trade firms. Quarterly Journal of Economics 108: 1015–1042.

    Article  Google Scholar 

  • Anderson, P.M., and B.D. Meyer. 1993. Unemployment insurance in the United States: Layoff incentives and cross subsidies. Journal of Labor Economics 11(1, Part II): S70–S95.

    Article  Google Scholar 

  • Anderson, P.M., and B.D. Meyer. 1994. The effects of unemployment insurance taxes and benefits on layoffs using firm and individual data, Working paper no. 4960. Cambridge, MA: NBER.

    Book  Google Scholar 

  • Anderson, P.M., and B.D. Meyer. 1997. The effects of firm specific taxes and government mandates with an application to the U.S. unemployment insurance program. Journal of Public Economics 65: 119–145.

    Article  Google Scholar 

  • Anderson, P.M., and B.D. Meyer. 2000. The effects of the unemployment insurance payroll tax on wages, employment, claims and denials. Journal of Public Economics 78: 81–106.

    Article  Google Scholar 

  • Atkinson, A.B.., and J. Micklewright. 1991. Unemployment compensation and labor market transitions: A critical review. Journal of Economic Literature 29: 1679–1727.

    Google Scholar 

  • Baily, M. 1976. On the theory of layoffs and unemployment. Econometrica 45: 1043–1063.

    Article  Google Scholar 

  • Baily, M.N. 1978. Some aspects of optimal unemployment insurance. Journal of Public Economics 10: 379–402.

    Article  Google Scholar 

  • Brechling, F. 1977a. The incentive effects of the U.S. unemployment insurance tax. In Research in labor economics, ed. R. Ehrenberg. Greenwich: JAI Press.

    Google Scholar 

  • Brechling, F. 1977b. Unemployment insurance and labor turnover: Summary of theoretical findings. Industrial and Labor Relations Review 30: 483–494.

    Article  Google Scholar 

  • Card, D., and P.B. Levine. 1994. Unemployment insurance taxes and the cyclical and seasonal properties of unemployment. Journal of Public Economics 53: 1–29.

    Article  Google Scholar 

  • Chetty, R. 2006. A general formula for the optimal level of social insurance. Journal of Public Economics 90: 1879–1901.

    Article  Google Scholar 

  • Decker, P.T. 1997. Work incentives and disincentives. In Unemployment insurance in the United States: Analysis of policy issues, ed. C.J. O’Leary and S.A. Wandner. Kalamazoo: W.E. Upjohn Institute for Employment Research.

    Google Scholar 

  • Feldstein, M.S. 1976. Temporary layoffs in the theory of unemployment. Journal of Political Economy 84: 937–957.

    Article  Google Scholar 

  • Gruber, J. 1997. The consumption smoothing benefits of unemployment insurance. American Economic Review 87: 192–205.

    Google Scholar 

  • Hopenhayn, H.A., and J.P. Nicolini. 1997. Optimal unemployment insurance. Journal of Political Economy 105: 412–438.

    Article  Google Scholar 

  • Katz, L.F., and B.D. Meyer. 1990. Unemployment insurance, recall expectations, and unemployment outcomes. Quarterly Journal of Economics 105: 973–1002.

    Article  Google Scholar 

  • Meyer, B.D. 1990. Unemployment insurance and unemployment spells. Econometrica 58: 757–782.

    Article  Google Scholar 

  • Meyer, B.D. 1995. Lessons from the U.S. unemployment insurance experiments. Journal of Economic Literature 33: 91–131.

    Google Scholar 

  • Moffitt, R., and W. Nicholson. 1982. The effect of unemployment insurance on unemployment: The case of federal supplemental benefits. Review of Economics and Statistics 64: 1–11.

    Article  Google Scholar 

  • Mortensen, D.T. 1977. Unemployment insurance and job search decisions. Industrial and Labor Relations Review 30: 505–517.

    Article  Google Scholar 

  • Storey, J.R., and J.A. Niesner. 1997. Unemployment compensation in the group of seven nations. In Unemployment insurance in the United States: Analysis of policy issues, ed. C.J. O’Leary and S.A. Wandner. Kalamazoo: W.E. Upjohn Institute for Employment Research.

    Google Scholar 

  • Topel, R.H. 1983. On layoffs and unemployment insurance. American Economic Review 73: 541–559.

    Google Scholar 

Download references

Author information

Authors and Affiliations

  1. http://link.springer.com/referencework/10.1057/978-1-349-95121-5

    Patricia M. Anderson

Authors
  1. Patricia M. Anderson
    View author publications

    You can also search for this author in PubMed Google Scholar

Editor information

Editors and Affiliations

    Copyright information

    © 2008 The Author(s)

    About this entry

    Cite this entry

    Anderson, P.M. (2008). Unemployment Insurance. In: The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-95121-5_2844-1

    Download citation

    • DOI: https://doi.org/10.1057/978-1-349-95121-5_2844-1

    • Received:

    • Accepted:

    • Published:

    • Publisher Name: Palgrave Macmillan, London

    • Online ISBN: 978-1-349-95121-5

    • eBook Packages: Springer Reference Economics and FinanceReference Module Humanities and Social SciencesReference Module Business, Economics and Social Sciences

    Publish with us

    Policies and ethics

    Search

    Navigation