Optimal unemployment insurance with non-separable preferences

In this paper, we characterize the shape of optimal unemployment contracts when the preferences are non-separable. We show that the optimal contract generates an endogenous minimum replacement ratio.

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Bibliographic Details
Published inEconomics letters Vol. 93; no. 2; pp. 267 - 271
Main Author Menard, Sebastien Université du Maine
Format Journal Article
LanguageEnglish
Published Elsevier B.V 01.11.2006
Elsevier
SeriesEconomics Letters
Subjects
Contracts
Mathematical methods
Moral hazard
Recursive contracts
Unemployment insurance
J65
J64
Unemployment insurance
Recursive contracts
C61
Moral hazard
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Summary:In this paper, we characterize the shape of optimal unemployment contracts when the preferences are non-separable. We show that the optimal contract generates an endogenous minimum replacement ratio.
Bibliography:ObjectType-Article-2
SourceType-Scholarly Journals-1
ObjectType-Feature-1
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ISSN:0165-1765
1873-7374
DOI:10.1016/j.econlet.2006.05.012