Literature Review and Empirical Essay

From the beforehand(predicate) eighties to the nineties, the meter arrange increased modestly, but is in time be commencement its mid-seventies level. While researchers have determine many reasons for the low UI recipiency rate everyplace the past twenty years, many questions remain as to the causes behind the low rate and steps that policy and program officials qualification take to increase it. While the normal consecrate is the most ordinarily used sum to evaluate the intensity level of the UI program, researchers have developed alternate UI recipiency rank to address some of the limitations of the standard measure.The standard measure is verbalised as the ratio of the insured dismissed (i. e. , the come of unbroken UI claimants) to the total number businessless. Alternative measures have been designed to purify capture the effectiveness of the UI program by including the full range of UI programs available to the unemployed (beyond the steady program) and b y more accurately defining the UI target population (a subset of unemployed workers).Purpose and Methodology The purpose of this report is to examine why the mensuration outrank, as well as alternative recipiency rank, declined crisply in the early eighties and continued to remain well below their midseventies level in the early nineties. We critically reviewed the findings from the research literature to explore the factors others have identified to explain the drop in the UI recipiency rate. The literature review enabled us to divulge factors for inclusion in our empirical abridgment and to assess the effects of factors that could not be included in our own analysis.Our empirical analysis is ground primarily on the methodology used by Burtless and Saks (1984) and focuses only on changes in the UI recipiency rate over recessionary periods. It is important to compare homogeneous economic periods because the UI recipiency rate is higher during recessionary periods and lower d uring periods of economic expansion. We head start replicated the analysis from Burtless and Saks, estimating the effects of various factors that influenced the rate used in their pilot light analysis from the seventies recession (1975-76) to the eighties recession (1981-83).We then blanket(a) their earlier analysis by testing the effects of additional factors during that period. Next, we updated the analysis to include data from the most recent recessionary period in the nineties (1991-92). We chose the period in the nineties to be consistent with the periods of lift unemployment order selected by Burtless and Saks. Finally, we increase their analysis by using the Standard localize and two additional measures of UI recipiency selected to measure the performance of the UI programs during recessionary periods.Our conclusions close the effects of various factors on the UI recipiency rate are based on the findings from both the critical review of the literature and our empirica l analysis. We also deport evaluation design options to address some of the limitations of current knowledge. The Lewin Group, Inc. E-1 156059 Executive epitome C. UI Recipiency Rate Measures Four UI recipiency rate measures were selected for the empirical analysis.Standard Rate number of hebdomadal claims for regular program unemployment insurance benefits, as a comparison of all unemployed workers1 All Programs Rate number of each week claims for all program (regular, extended and federal) unemployment insurance benefits, as a balance wheel of all unemployed workers Standard unequal Rate number of weekly claims for regular program unemployment insurance benefits, as a proportion of business sector losers unemployed less than 27 weeks and All Programs bank line Loser Rate number of weekly claims for all program (regular, extended and federal) unemployment insurance benefits, as a proportion of all job losers.The final three UI recipiency rates deviate from the Standard Ra te by changing the definition of UI claimants, unemployed workers, or both. Because the All Programs Rate and the All Programs Job Loser Rate include all UI program claimants, Wandner and Stengle (1996) argue that they are generally better measures of UI coverage during recessionary periods when extended benefit programs are provided. The All Programs Job Loser Rate differs from the All Programs Rate because it targets a subset of unemployed workers (i. e. , job losers) who would be most likely to qualify for UI benefits. The Standard Short-term Rate only includes regular program claimants and the general target population for the regular state program, job losers unemployed less than 27 weeks.This final measure was used in the original Burtless and Saks analysis. All three alternative rates are larger than the Standard Rate because they use all a more expansive definition of UI claimants and/or a more confining definition of unemployed workers. From the seventies to the eighties, all four recipiency rates declined sharply (Exhibit 1). The largest reductions are for the All Programs Rate and the All Programs Job Loser Rate. These rates declined by more than the Standard Rate because of the large cutbacks in the extended benefit programs that were implemented in the early eighties. From the eighties to the nineties, the Standard Rate increased slightly.There is not, however, a large change in either the All Programs or All Programs Job Loser rates over this period, due to the small number of extended claimants. If, however, the analysis were extended to periods spare-time activity March 1992, there would be an increase in both of these rates because of the extension of benefits through the Emergency Unemployment Compensation (EU3) program. 2 The Standard Short-term Rate follows the same general pattern as the Standard Rate, though there is a much sharper drop-off in the Standard Short-term rate in the early eighties that corresponds with fewer short term job losers receiving regular program benefits.