Unemployment insurance and the role of self-insurance
- Unemployment insurance and the role of self-insurance
- Abdulkadiroglu, Atila
- Persistent URL:
- Department of Economics Discussion Papers
- Part Number:
- March 2002
- Department of Economics, Columbia University
- Publisher Location:
- New York
- This paper employs a dynamic general equilibrium model to design and evaluate long-term unemployment insurance plans (plans that depend on workers' unemployment history) in economies with and without hidden savings. We show that optimal benefit schemes and welfare implications differ considerably in these two economies. Switching to long-term plans can improve welfare significantly in the absence of hidden savings. However, welfare gains are much lower when we consider hidden savings. Therefore, we argue that switching to long-term plans should not be a primary concern from a policy point of view.
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- Suggested Citation:
- Atila Abdulkadiroglu, Burhanettin Kuruscu, Aysegul Sahin, 2002, Unemployment insurance and the role of self-insurance, Columbia University Academic Commons, https://doi.org/10.7916/D81J9P0J.