Optimal Unemployment Insurance with Monitoring and Sanctions

Jan Boone, Peter Fredriksson, Bertil Holmlund () and Jan van Ours

No 2001:20, Working Paper Series from Uppsala University, Department of Economics

Abstract: This paper analyzes the design of optimal unemployment insurance in a search equilibrium framework where search effort among the unemployed is not perfectly observable. We examine to what extent the optimal policy involves monitoring of search effort and benefit sanctions if observed search is deemed insufficient. We find that introducing monitoring and sanctions represents a welfare improvement for reasonable estimates of monitoring costs; this conclusion holds both relative to a system featuring indefinite payments of benefits and a system with a time limit on unemployment benefit receipt. The optimal sanction rates implied by our calibrated model are much higher than the sanction rates typically observed in European labor markets.

Keywords: Unemployment insurance; search; sanctions (search for similar items in EconPapers)
JEL-codes: J64 J65 J68 (search for similar items in EconPapers)
Pages: 30 pages
Date: 2001-11-02
New Economics Papers: this item is included in nep-lab and nep-pub
References: Add references at CitEc
Citations: View citations in EconPapers (18)

Published in Economic Journal, 2007, pages 399-421.

Downloads: (external link)
http://www.nek.uu.se/pdf/2001wp20.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://www.nek.uu.se/pdf/2001wp20.pdf [301 Moved Permanently]--> https://www.nek.uu.se/pdf/2001wp20.pdf [301 Moved Permanently]--> https://www.uu.se/institution/nationalekonomiska/pdf/2001wp20.pdf)

Related works:
Journal Article: Optimal Unemployment Insurance with Monitoring and Sanctions (2007)
Working Paper: Optimal unemployment insurance with monitoring and sanctions (2007)
Working Paper: Optimal unemployment insurance with monitoring and sanctions (2002)
Working Paper: Optimal Unemployment Insurance with Monitoring and Sanctions (2001)
Working Paper: Optimal Unemployment Insurance with Monitoring and Sanctions (2001)
Working Paper: Optimal Unemployment Insurance with Monitoring and Sanctions (2001)
Working Paper: Optimal Unemployment Insurance with Monitoring and Sanctions (2001)
Working Paper: Optimal Unemployment Insurance with Monitoring and Sanctions (2001)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hhs:uunewp:2001_020

Access Statistics for this paper

More papers in Working Paper Series from Uppsala University, Department of Economics Department of Economics, Uppsala University, P. O. Box 513, SE-751 20 Uppsala, Sweden. Contact information at EDIRC.
Bibliographic data for series maintained by Ulrika Öjdeby ().