Article thumbnail
Location of Repository

Reemployment Incentives for Unemployment Insurance Beneficiaries: Results from the Washington Reemployment Bonus Experiment

By Christopher J. O'Leary, Robert G. Spiegelman and Kenneth J. Kline

Abstract

Unemployment insurance is intended to reduce hardship by providing labor force members with partial wage replacement during periods of involuntary unemployment. However, in performing this income maintenance function, unemployment insurance may prolong spells of unemployment. Evidence from a field experiment conducted in Illinois in 1984 suggested that offering unemployment insurance claimants a modest cash bonus for rapid reemployment would increase the speed of return to work and reduce program costs. In 1988 a similar experiment, examining several different bonus offers, was conducted in Washington State. Evidence from the Washington experiment indicates that bonus offers do change job seeking behavior, but that only relatively generous bonus offers about six times the weekly benefit amount should be expected to significantly change the behavior of persons eligible for unemployment benefits.unemployment, insurance, bonus, experiment, Washington, O'Leary

OAI identifier:

Suggested articles

Citations

  1. (1992). A Comparison of the Impacts of Cash Bonuses on Reemployment Hazard Rates in the New Jersey and Illinois Unemployment Insurance Interventions."
  2. (1987). An Incentives Approach to Improving the Unemployment Compensation System,
  3. (1974). Applied Linear Statistical Models,
  4. (1988). Economic Duration Data and Hazard Functions,"
  5. (1991). Effects of a Reemployment Bonus under Differing Benefit Entitlements, or, Why the Illinois Experiment Worked."
  6. (1958). Estimation of Relationships for Limited Dependent Variables,"
  7. (1991). Evaluation of the Impacts of the Washington Alternative Work Search Experiment, Unemployment Insurance Occasional Paper 91-4,
  8. (1983). Limited-dependent and qualitative variables in econometrics, Cambridge:
  9. (1992). Pennsylvania Reemployment Bonus Demonstration: Final Report, Unemployment Insurance Occasional Paper 92-1,
  10. (1947). Probit Analysis, Cambridge:
  11. (1991). Recent Trends in Insured and Uninsured Unemployment: Is there an Explanation?,"
  12. (1977). Statistical Power Analysis for the Behavioral Sciences, revised edition,
  13. (1989). The New Jersey Unemployment Insurance Reemployment Demonstration Project: Final Evaluation Report, Unemployment Insurance Occasional Paper 89-3,
  14. (1975). The Unemployment Caused by Unemployment Insurance," Industrial Relations Research Association Series:
  15. (1992). The Washington Reemployment Bonus Experiment: Final Report, Unemployment Insurance Occasional Paper 92-6,

To submit an update or takedown request for this paper, please submit an Update/Correction/Removal Request.