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bklm1234 bklm1234
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2 months ago
The unemployed workers of Perrylia could receive up to 30 weeks of unemployment insurance. However, during a recent recession, the government extended the eligibility period to 45 weeks. How is this change in policy likely to affect the labor market in Perrylia?
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Macroeconomics


Edition: 3rd
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chevy87chevy87
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Such a policy is likely to have complex effects on the labor market in Perrylia. Lengthening eligibility to 45 weeks will reduce the hardships that unemployed workers suffer and will give them more time to find a job that is a good fit for their skills, but lengthened eligibility will also partially reduce the incentive for unemployed workers to find new jobs. This will shift the labor supply curve of Bosnia to the left, which, holding all else equal, will reduce employment.

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