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Department of Economics, Aarhus School of Business, University of Aarhus Working Papers, Department of Economics, Aarhus School of Business, University of Aarhus

No 09-1:
The Effect of Receiving Supplementary UI Benefits on Unemployment Duration

Tomi Kyyrä (), Pierpaolo Parrotta () and Michael Rosholm ()

Abstract: We consider the consequences of working part-time on supplementary unemployment insurance benefits in the Danish labour market. Following the “timing-of-events” approach we estimate causal effects of subsidized part-time work on the hazard rate out of unemployment insurance benefit receipt. We find evidence of a negative lock-in effect and a positive post-treatment effect, both of which vary across individuals. The resulting net effect on the expected unemployment duration is positive for some groups (e.g. married women) and negative for others (e.g. young workers)

Keywords: Unemployment benefits; Part-time work; Lock-in effect; Treatment effect; Duration analysis; (follow links to similar papers)

JEL-Codes: C41; J65; (follow links to similar papers)

42 pages, January 1, 2009

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This paper is forthcoming as:
Kyyrä, Tomi, Pierpaolo Parrotta and Michael Rosholm, 'The Effect of Receiving Supplementary UI Benefits on Unemployment Duration', Labour Economics.



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