Resource title

Bismarck versus Beveridge: Which Unemployment Compensation System is More Prone to Labor Market Shocks?

Resource image

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Resource description

Based on a model with imperfectly competitive labor and product markets the real consequences of labor market shocks for economies with either an earnings-related or flatrate unemployment compensation system are considered. A distinctive feature of the analysis is the comparison of both unemployment compensation systems in a two-country setting. It is demonstrated that the performance of a system with earnings-related or flat-rate unemployment benefits depends on whether the labor market shock is provoked in the home country or originates from abroad. We also point out how our results extend to two-tier unemployment compensation systems which differ with respect to the relative importance of earnings-related and flat-rate benefits.

Resource author

Thomas Beissinger, Oliver Buesse

Resource publisher

Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/21218

Resource license

Adapt according to the presented license agreement and reference the original author.