Project Details
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Job Search Effort during Unemployment: Insights from New Data and Theory

Applicant Dr. Joerg Heining
Subject Area Statistics and Econometrics
Economic Policy, Applied Economics
Term from 2017 to 2019
Project identifier Deutsche Forschungsgemeinschaft (DFG) - Project number 329151064
 
Final Report Year 2020

Final Report Abstract

The job finding rate of Unemployment Insurance (UI) recipients declines in the initial months of unemployment and then exhibits a spike at the benefit exhaustion point. A range of theoretical explanations have been proposed, but those are hard to disentangle using data on job finding alone. To better understand the underlying mechanisms, we conducted a large text-message-based survey of unemployed workers in Germany. We surveyed 6,800 UI recipients twice a week for 4 months about their job search effort. The panel structure allows us to observe how search effort evolves within individual over the unemployment spell. We provide three key facts: 1) search effort is flat early on in the UI spell, 2) search effort exhibits an increase up to UI exhaustion and a decrease thereafter, 3) UI recipients do not appear to time job start dates to coincide with the UI exhaustion point. A model of reference-dependent job search can explain these facts well, while a standard search model with unobserved heterogeneity struggles to explain the second fact. The third fact also leaves little room for a model of storable offers to explain the spike.

Publications

  • (2019): “Evidence on Job Search Models from a Survey of Unemployed Workers in Germany”, INSEAD-Science Po Labor Conference, Paris, France, November 2019
    DellaVigna, Stefano
 
 

Additional Information

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