"Severance pay, a program that provides compensation to workers on termination of employment, is the most widely used income protection program for the unemployed--yet it is often blamed for creating economic inefficiencies such as reducing employment and limiting access to jobs for...

This paper investigates how the potential duration of unemployment benefits affects the quality of post-unemployment jobs. It takes advantage of a natural experiment introduced by a change in Slovenia's unemployment insurance law that substantially reduced the potential benefit duration....