The Impact of Unemployment Insurance Savings Accounts on Labor Market Outcomes: Wages and Contract Type

Paula Nagler, UNU-MERIT / School of Governance

The introduction of unemployment insurance savings accounts (UISA) in Chile in October 2002 led to more comprehensive unemployment protection while decreasing the opportunity costs of job change. Using a regression discontinuity design (RDD) I examine in this paper whether the introduction of UISA had an impact on the following wage and contract type (i) for workers changing into a new employment, and (ii) for workers experiencing a period of unemployment before re-entering the labor market. The analysis is performed on longitudinal social protection data and is the first to empirically investigate the effect of UISA on post-employment job quality. The paper does not find a significant change in the following income for workers of both subsamples, but find indications for a positive outcome in the number of permanent contract type for workers that experience a period of unemployment. For specific subgroups I find evidence for an increase in the number of permanent contracts for female workers and young workers below the age of 30, as well as for both workers from Santiago and other regions, all experiencing a period of unemployment. For young workers directly changing into a new employment, UISA affiliation shows a negative impact on the following income. Overall this evidence is however weak, and indicates at best that workers experiencing a period of unemployment have a higher probability of receiving a permanent contract for certain subgroups.

Discussant: Andrés Mideros

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Venue: Conference room, Keizer Karelplein 19, Maastricht

Date: 28 October 2014

Time: 14:45 - 15:30


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