Andrew Johnston

First name
Andrew
Last name
Johnston
Abstract

We provide new evidence on the effect of the unemployment insurance (UI) weekly benefit
amount on unemployment insurance spells based on administrative data from the state of Missouri covering the period 2003-2013. Identification comes from a regression kink design that exploits the quasi-experimental variation around the kink in the UI benefit schedule. We find that UI durations are more responsive to benefit levels during the recession and its aftermath, with an elasticity between 0.65 and 0.9 as compared to about 0.35 pre-recession.

Year of Publication
2015
Number
585
Date Published
01/2015
Publication Language
eng
Citation Key
9122
Pei, Z., Card, D., Mas, A., Leung, P., & Johnston, A. (2015). The Effect of Unemployment Benefits on the Duration of Unemployment Insurance Receipt: New Evidence from a Regression Kink Design in Missouri, 2003-2013. Retrieved from http://arks.princeton.edu/ark:/88435/dsp01f4752j974 (Original work published 01/2015AD)
Working Papers
Abstract

In this paper we examine how an unanticipated cut in potential unemployment insurance (UI) duration, which reduced maximum duration in Missouri by 16 weeks, affected the search behavior of UI recipients and the aggregate labor market. Using a regression discontinuity design (RDD), we estimate that a one-month reduction in maximum duration is associated with 15 fewer days of UI receipt and 8.6 fewer days of nonemployment. We use the RDD estimates to simulate the change in the time path of the unemployment rate assuming there are no market-level externalities. The simulated response closely approximates the estimated change in the unemployment rate following the benefit cut, suggesting that even in a period of high unemployment, the labor market was able to absorb this influx of workers without crowding out other jobseekers.

Year of Publication
2015
Number
590
Date Published
06/2015
Publication Language
eng
Citation Key
9207
Mas, A., & Johnston, A. (2015). Potential Unemployment Insurance Duration and Labor Supply: The Individual and Market-Level Response to a Benefit Cut. Retrieved from http://arks.princeton.edu/ark:/88435/dsp014f16c5130 (Original work published 06/2015AD)
Working Papers