Scandinavian Working Papers in Economics

Working Paper Series,
Research Institute of Industrial Economics

No 159: The Effects of Unemployment Compensation in General Equilibrium with Search Unemployment

Bo Axell and Harald Lang
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Bo Axell: Research Institute of Industrial Economics (IFN)
Harald Lang: Research Institute of Industrial Economics (IFN)

Abstract: In this article it is shown that when the effects of an increase in unemployment subsidies are studied in a general equilibrium framework, unemployment increases far less than in a "partial-partial" model, or may even decrease.

Keywords: Unemployment subsidies; general equilibrium; partial model

JEL-codes: J64; J65

19 pages, June 1986

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