Unemployment Duration, Benefit Duration, and the Business Cycle.Versión Revisada

• Olympia Bover ^[2] ; Manuel Arellano ^[1] ; Samuel Bentolila ^[1]
  1. [1] Centro de Estudios Monetarios y Financieros

     Centro de Estudios Monetarios y Financieros

     Madrid, España

     
  2. [2] Banco de España
• Localización: Documentos de Trabajo ( CEMFI ), Nº. 17 (CEMFI Working Paper No. 9717, October 1997), 1997
• Idioma: inglés
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• Resumen

  • In this paper we study the effects of unemployment benefit duration and the business cycle on unemployement duration. We construct durations for individuals entering unemployment from a longitudinal sample of Spanish men in 1987-1994. Estimated discrete hazard models indicates that receipt of unemployment benefits significantly reduces the hazard of leaving unemployment. For instance, at durations of 3 months, the hazard for workers without benefits is twice as large as that for workers with benefits. Favorable business conditions increase the hazard of leaving unemployment. At sample-period magnitudes, this effect is significantly smaller than that of benefit receipt.