TY  - RPRT
        AU  - Haan, Peter
AU  - Prowse, Victoria L.
        TI  - Optimal Social Assistance and Unemployment Insurance in a Life-Cycle Model of Family Labor Supply and Savings
        PY  - 2015/Apr/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 8980
        UR  - https://www.iza.org/index.php/publications/dp8980
        AB  - We analyze empirically the optimal design of social insurance and assistance programs when families obtain insurance by making labor supply choices for both spouses. For this purpose, we specify a structural life-cycle model of the labor supply and savings decisions of singles and married couples. Partial insurance against wage and employment shocks is provided by social programs, savings and the labor supplies of all adult household members. The optimal policy mix focuses mainly on Social Assistance, which provides a permanent universal household income floor, with a minor role for temporary earnings-related Unemployment Insurance. Reflecting that married couples obtain intra-household insurance by making labor supply choices for both spouses, the optimal generosity of Social Assistance decreases in the proportion of married individuals in the population. The link between optimal program design and the family context is strongest in low-educated populations.
        KW  - life-cycle labor supply
KW  - family labor supply
KW  - unemployment insurance
KW  - social assistance
KW  - design of benefit programs
KW  - intra-household insurance
KW  - household savings
KW  - employment risk
KW  - added worker effect
        ER  -