Gespeichert in:
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| Format: | Entrada de enciclopedia |
| Veröffentlicht: |
International Labour Organization
2021
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| Online-Zugang: | https://researchrepository.ilo.org/esploro/outputs/encyclopediaEntry/Welfare-effects-of-unemployment-benefits-when/995218899902676 |
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Inhaltsangabe:
- Welfare effects of unemployment benefits when informality is high Hannah Liepmann Clemente Pignatti We analyze for the first time the welfare effects of unemployment benefits (UBs) in a context of high infor- mality, exploiting matched administrative and survey data with individual-level information on UB receipt, formal and informal employment, wages and consumption. Using a difference-in-differences approach, we find that dismissal from a formal job causes a large drop in consumption, which is between three to six times larger than estimates for developed economies. This is generated by a permanent shift of UB re- cipients towards informal employment, where they earn substantially lower wages. We then exploit a kink in benefits and show that more generous UBs delay program exit through a substitution of formal with informal employment. However, the disincentive effects are small and short-lived. Because of the high insurance value and the low efficiency costs, welfare effects from increasing UBs are positive for a range of values of the coefficient of relative risk aversion. ILO working paper, 39, ILO ISBN 9789220351857 publication.encyclopediaEntry