Extended Benefit-Entitlement Periods and the Duration of Unemployment in West-Germany

Steiner, Viktor

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URL: http://ub-madoc.bib.uni-mannheim.de/701
URN: urn:nbn:de:bsz:180-madoc-7014
Document Type: Working paper
Year of publication: 1997
The title of a journal, publication series: None
Publication language: English
Institution: Sonstige Einrichtungen > ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung
MADOC publication series: Veröffentlichungen des ZEW (Leibniz-Zentrum für Europäische Wirtschaftsforschung) > ZEW Discussion Papers
Subject: 330 Economics
Subject headings (SWD): Deutschland , Langzeitarbeitslosigkeit , Meinungsverschiedenheit
Abstract: Germany, as most other European countries, has been plagued by a persistently high level of long–term unemployment since the early 1980's. In contrast, long–term unemployment is much less of a problem in the United States. One potential reason for the different structure of unemployment relates to institutional differences in unemployment compensation systems. The German system is characterized by relatively high income–replacement ratios and extended benefit–entitlement periods which are often followed by the availability of open–ended unemployment or social assistance schemes. In contrast, unemployment insurance payments in the United States are terminated after about six months as a rule, and entitlement to subsequent welfare payments are only available to lone mothers and the disabled. Can these institutional differences explain the higher level of long–term unemployment in Germany relative to the United States?
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