TY  - JOUR
AU  - Lemieux,Thomas
AU  - MacLeod,W. Bentley
TI  - Supply Side Hysterisis:  The Case of the Canadian Unemployment InsuranceSystem
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 6732
PY  - 1998
Y2  - September 1998
UR  - http://www.nber.org/papers/w6732
L1  - http://www.nber.org/papers/w6732.pdf
N1  - Author contact info:
Thomas Lemieux
Department of Economics
Vancouver School of Economics
University of British Columbia
#997-1873 East Mall
Vancouver, BC V6T 1Z1
CANADA
Tel: 604/822-2092
Fax: 604/822-5915
E-Mail: thomas.lemieux@ubc.ca

W. Bentley MacLeod
Department of Economics
Columbia University
420 West 118th Street, MC 3308
New York, NY 10027
Tel: 310-571-5083
Fax: 212/854-4782
E-Mail: bentley.macleod@columbia.edu
M2  - featured in NBER digest on 1999-01-01
AB  - This paper presents results from a 1971 natural experiment carried out by the Canadian government on the unemployment insurance system.  At that time, they dramatically increased the generosity of the system.  We find that the propensity to collect UI increases with a first time exposure to the system.  Hence as more individuals experience unemployment their lifetime use of the system increases.  This supply side hysterisis effect may explain why unemployment has steadily increased over the 1972 - 1992 period, even though the generosity of unemployment insurance did not.
ER  -