Generous unemployment benefits lie at the heart of the conventional explanation for persistent high unemployment. The effects of benefit generosity on work incentives are more ambiguous in a broader behavioural framework in which workers get substantial disutility from unemployment (given...

With much of Europe plagued by high levels of unemployment, it has become widely accepted that the culprit is labor market rigidity and that the prescription can only be labor market deregulation: lower wages, higher earnings inequality, greater decentralization in bargaining, less generous...

In the midst of sharply rising long-term unemployment, a series of unemployment benefit (UB) eligibility extensions raised the regular 26-week limit to as many as 99 weeks in some states. In response, leading economists have invoked the ‘laws of economics' to warn that the extensions may be...

A rapidly expanding empirical literature has addressed the widely accepted claim that employment-unfriendly labor market institutions explain the pattern of unemployment across countries. The main culprits are held to be protective institutions, namely unemployment benefit entitlements,...