Aspects of Optimal Unemployment Insurance: Search, Leisure and Capital Market Imperfections
Year: 1977
Type: report
Abstract: The object of this paper is to examine the importance of capital market assumptions. A special continuous-time model is developed in sections II-IV which is applicable to the perfect capital market case. It can also be used when there is no capital market at all (section IV). For 'reasonable' parameter values the optimal replacement rate (ratio of benefits to gross wage) appears to be less than 20% when capital markets are perfect but over 70% when they are non existent (i.e. no saving or dis-saving).
DOI: 10.3386/w0214
Author: J. Flemming
Institution: University of Oxford
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W2158388693