Revisiting the Effects of Unemployment Insurance Extensions on Unemployment: A Measurement-Error-Corrected Regression Discontinuity Approach

Date
2020-05-01
Authors
Dieterle, Steven
Bartalotti, Otávio
Brummet, Quentin
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Altmetrics
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Economics
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Abstract

This study documents two potential biases in recent analyses of UI benefit extensions using boundary-based identification: bias from using county-level aggregates and bias from across-border policy spillovers. To examine the first bias, the analysis uses a regression discontinuity approach that accounts for measurement error in county-level aggregates. These results suggest much smaller effects than previous studies, casting doubt on the applicability of border-based designs. The analysis then shows substantial spillover effects of UI benefit duration on across-border work patterns, consistent with increased tightness in high-benefit states and providing evidence against a dominant vacancy reduction response to UI extensions.

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This article is published as Dieterle, Steven, Otávio Bartalotti, and Quentin Brummet. 2020. "Revisiting the Effects of Unemployment Insurance Extensions on Unemployment: A Measurement-Error-Corrected Regression Discontinuity Approach." American Economic Journal: Economic Policy, 12 (2): 84-114. doi: 10.1257/pol.20160439. Posted with permission.

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