Unemployment Compensation Finance and Efficiency Wages Albrecht, James W; Vroman, Susan B

User activity

Share to:
View the summary of this work
Albrecht, James W ; Vroman, Susan B
Appears In
Journal of Labor Economics
Unemployment insurance -- Finance; Unemployment Insurance; Human resources and labor relations
Academic; Trade
This article examines the effects of unemployment compensation finance in a labor market in which firms pay efficiency wages. Two self-financing unemployment compensation systems are compared: one in which benefits are financed by a proportional payroll tax and another in which experience rating is introduced by taxing firms in proportion to their separations. We find that experience rating leads to less unemployment, less shirking, and higher output. An equilibrium unemployment model is used to compare the effects of the use of an experience rating system and the use of a pure payroll-tax to finance unemployment compensation. Study results indicate that, in accordance with conventional wisdom, experience rating is a more desirable finance system, in that it results in less unemployment than would result from a pure payroll-tax system.
Work ID

2 editions of this work

Find a specific edition
Thumbnail [View as table] [View as grid] Title, Author, Edition Date Language Format Libraries

User activity

e.g. test cricket, Perth (WA), "Parkes, Henry"

Separate different tags with a comma. To include a comma in your tag, surround the tag with double quotes.

Be the first to add a tag for this work

Be the first to add this to a list

Comments and reviews

What are comments? Add a comment

No user comments or reviews for this work

Add a comment

Show comments and reviews from Amazon users