%0 Report
        %A Johnston, Andrew C.
%A Mas, Alexandre
        %T Potential Unemployment Insurance Duration and Labor Supply: The Individual and Market-Level Response to a Benefit Cut
        %D 2020
        %8 2020 Jun
        %I Institute of Labor Economics (IZA)
        %C Bonn
        %7 IZA Discussion Paper
        %N 13331
        %U https://www.iza.org/index.php/publications/dp13331
        %X We examine how a 16-week cut in potential unemployment insurance (UI) duration in Missouri affected search behavior of UI recipients and the aggregate labor market. Using a regression discontinuity design (RDD), we estimate a marginal effect of maximum duration on UI and nonemployment spells of approximately 0.45 and 0.25 respectively. We use the RDD estimates to simulate the unemployment rate assuming no market-level externalities. The simulated response, which implies almost a one percentage point decline in the unemployment rate, closely approximates the estimated change in the unemployment rate following the benefit cut. This finding suggests that, even in a period of high unemployment, the labor market absorbed this influx of workers without crowding-out other jobseekers.
        %K unemployment
%K unemployment insurance
%K labor supply
%K benefits
%K employment