Abstract
To study how the design of unemployment insurance affects people leaving school to find jobs, a model of job search in the presence of UI is developed and estimated for the US and Canada. The level of UI benefits depends upon previous earnings, a fact which creates opposing incentives for unemployed people not receiving benefits. Which of these opposing incentives dominates differs across demographic groups within each country. The major differences in the transition from school to work between Canada and the U.S. are a lower rate of job offer arrivals and a lower rate of offer rejections in Canada. Within each country, offer arrival rates differ across individuals much more than offer rejection rates. (This abstract was borrowed from another version of this item.)
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