JLF head John Hood’s column Monday was on unemployment insurance, and how higher UI benefits affect unemployment rates. A sample:
Here in North Carolina, the debate about proposed changes to the unemployment-insurance system have prompted left-wing analysts to ridicule the notion that the amount and duration of UI benefits have an effect on the propensity for jobless recipients to accept employment offers. The notion is far from ridiculous, however. It is the consensus finding among labor economists of all ideological stripes. They may not agree about the magnitude of the effect, but they do agree that both job-search activity and the willingness to accept job offers tend to rise as the expiration date of UI benefits approaches. States and countries with more-generous UI benefits tend to have higher unemployment rates, all other things being equal, than states or countries with less-generous benefits.
Seems pretty logical to me, but then again I am an economist.
