Finance and Economics Discussion Series: Accessible versions of figures for 2017-068

How Large were the Effects of Emergency and Extended Benefits on Unemployment during the Great Recession and its Aftermath?

Accessible version of figures


Figure 1: Average Maximum Regular plus EEB Benefit Levels

Line graph. One panel. The chart shows two lines, one for the unemployment rate and one for the average maximum number of Weeks of Unemployment Insurance (UI) Benefits. The x axis goes from January 1990 to July 2014. The x axis associated with average maximum weeks of UI benefits ranges from 0 to 100. The y axis associated with the unemployment rate ranges from 0 to 10. The chart also has gray shading for NBER recession quarters. The chart shows that the unemployment rate has fluctuated between 4 and 10 percent, and the average maximum weeks of UI benefits has fluctuated between 25 and 100 weeks. The chart also shows that the unemployment rate and the average maximum number of weeks of unemployment insurance benefits increase either in the quarters during or in the quarters soon after NBER-dated recessions.

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Figure 2: Illustrating the Identification Strategy

Line graph. One panel. The chart shows two horizontal lines, one dashed and one solid, with an abrupt change in the level of each line at a point labeled T on the x axis. The dashed horizontal line represents the hypothetical difference in unemployment rates across two states that receive different adjustments to UI benefits at time T. The solid line represents the hypothetical difference in the maximum weeks of UI benefits that can be received across the two states. The change in the level of the dashed line at point T is labeled the “Change in the unemployment rate difference”. The change in the sold line is labeled “Change in benefit difference”.

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Figure 3: November 2008 Rule Change

Line graph. One panel. The chart presents data that corresponds to the hypothetical example illustrated in Figure 2. The chart shows two horizontal lines, one dashed, representing the difference in unemployment rates across two groups of states, and one solid, representing the difference in the maximum duration of Unemployment Insurance benefits across the two groups of states. The x axis extends from June 2008 to June 2009. The chart also shows a vertical line at October 2008, immediately before the November 2008 rule change. The chart shows that the difference in unemployment rates increased over most of this time period, with a somewhat higher slope immediately after the rule change. The sold line shows an abrupt jump in benefit levels at the time of the rule change, from a level close to 0 to a level between 10 and 15 weeks.

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Figure 4: November 2009 Rule Change

Line graph. One panel. The chart presents data that corresponds to the hypothetical example illustrated in Figure 2. The chart shows two horizontal lines, one dashed, representing the difference in unemployment rates across two groups of states, and one solid, representing the difference in the maximum duration of Unemployment Insurance benefits across the two groups of states. The x axis extends from June 2009 to June 2010. The chart also shows a vertical line at October 2009, immediately before the November 2009 rule change. The chart shows that the difference in unemployment rates increased initially over most of this time period but then leveled off and declined in the second half of this time period. There is no abrupt change in behavior after October 2009. The sold line shows an abrupt jump in the benefit levels at the time of the rule change, from a level close to 15 weeks to a level around 20 weeks. The solid line also drops abruptly at the end of the period.

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Figure 5: March-September 2012 Rule Change

Line graph. One panel. The chart presents data that corresponds to the hypothetical example illustrated in Figure 2. The chart shows two lines, one dashed, representing the difference in unemployment rates across two groups of states, and one solid, representing the difference in the maximum duration of Unemployment Insurance benefits across the two groups of states. The x axis extends from October 2011 to October 2012. The chart also shows a vertical line at February 2012, immediately before rule changes beginning in March. The chart shows that the difference in unemployment rates falls steadily throughout the period, with some flattening out immediately following the rule change. The sold line shows benefits fluctuating around a level of 25 weeks.

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Figure 6: January 2014 Rule Change

Line graph. Three panels. The chart presents data that corresponds to the hypothetical example illustrated in Figure 2. All three panels show two lines, one dashed, representing the difference in unemployment rates across two groups of states with different starting unemployment rates, and one solid, representing the difference in the maximum duration of Unemployment Insurance benefits across the two groups of states. The x axis for all three panels extends from July 2013 to July 2014. All three panels also show a vertical line at December 2013, immediately before the rule change beginning in January 2014. The top panel shows that the difference in unemployment rates falls somewhat more quickly after the rule change, while the difference in maximum benefits drops abruptly from about 20 weeks to 0 in January. The middle panel shows that the difference in unemployment rate falls steadily over the period, while the difference in benefits drops abruptly in January from a little over 10 weeks to 0. The bottom panel shows the unemployment rate declining before the rule change and flattening out immediately after the rule change. The solid line shows the difference in maximum benefits falling abruptly from between 5 and 10 weeks to 0 at the time of the rule change.

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Figure 7: Estimated Effects of EEB on the Unemployment Rate

One panel. Line graph and Bar chart. The chart shows 5 horizontal lines directly above 5 labeled point on the x axis. The lines correspond to the estimated effect of EEB on the unemployment rate for the rule changes in 2008, 2009, and 2014, as well as a simple average of these estimates and a weighted average of the estimates that minimizes the variance of the average estimate. The chart also shows vertical bars directly above each of the 5 labeled points on the x axis. The bars extend from the bottom end of a 90 percent confidence interval for these estimates to the top end of a 90 percent confidence interval. The chart shows that the estimated effect for the 2008 rule change was around 1¾ percentage point with a 90 percent confidence interval extending from about -1½ percentage points to 4¾ percentage points. The estimated effect for the 2009 rule change is about ½ percentage point with a 90 percent confidence interval extending from a little below 0 to a little above 1 percentage point. The estimated effect for the 2014 rule change is about ¼ percentage point with a 90 percent confidence interval that extends from a little below 0 to a little over ½ percentage point. The simple average of these estimates is about ¾ percentage point with a 90 percent confidence interval extending from a little below 0 to nearly 2 percentage points. The minimum variance average estimate is ¼ percentage point with a 90 percent confidence interval that extends from 0 to ½ percentage point.

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Figure 8: Estimated Effects of EEB on the Participation Rate

One panel. Line graph and Bar chart. The chart shows 5 horizontal lines directly above 5 labeled point on the x axis. The lines correspond to the estimated effect of EEB on the labor force participation rate for the rule changes in 2008, 2009, and 2014, as well as a simple average of these estimates and a weighted average of the estimates that minimizes the variance of the average estimate. The chart also shows vertical bars directly above each of the 5 labeled points on the x axis. The bars extend from the bottom end of a 90 percent confidence interval for these estimates to the top end of a 90 percent confidence interval. The chart shows that the estimated effect for the 2008 rule change was around 5½ percentage point with a 90 percent confidence interval extending from about -1 percentage points to nearly 13 percentage points. The estimated effect for the 2009 rule change is about 0 with a 90 percent confidence interval extending from a about 1½ percentage point to about 1½ percentage point. The estimated effect for the 2014 rule change is close to 0 with a 90 percent confidence interval that extends from a little below 0 to about ½ percentage point. The simple average of these estimates is about 2 percentage point with a 90 percent confidence interval extending from -1/2 percentage point to 4 percentage points. The minimum variance average estimate is close to 0 with a 90 percent confidence interval that extends from a little below 0 to 1/4 percentage point.

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Figure C1: November 2008 Rule Change

Line graph. One panel. The chart shows two horizontal lines, one dashed, representing the difference in labor force participation rates across two groups of states, and one solid, representing the difference in the maximum duration of Unemployment Insurance benefits across the two groups of states. The x axis extends from June 2008 to June 2009. The chart also shows a vertical line at October 2008, immediately before the November 2008 rule change. The chart shows that the difference in participation rates declined before the rule change and flattened out after the rule change. The sold line shows an abrupt jump in the benefit levels at the time of the rule change, from a level close to 0 to a level between 10 and 15 weeks.

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Figure C2: November 2009 Rule Change

Line graph. One panel. The chart shows two horizontal lines, one dashed, representing the difference in labor force participation rates across two groups of states, and one solid, representing the difference in the maximum duration of Unemployment Insurance benefits across the two groups of states. The x axis extends from June 2009 to June 2010. The chart also shows a vertical line at October 2009, immediately before the November 2009 rule change. The chart shows that the difference in participation rates was flat before the rule change and increased moderately after the rule change. The sold line shows an abrupt jump in the benefit levels at the time of the rule change, from a level close to 15 weeks to a level around 20 weeks. The solid line also drops abruptly at the end of the period.

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Figure C3: January 2014 Rule Change

Line graph. Three panels. All three panels show two lines, one dashed, representing the difference in labor force participation rates across two groups of states with different starting unemployment rates , and one solid, representing the difference in the maximum duration of unemployment insurance benefits across the two groups of states. The x axis for all three panels extends from July 2013 to July 2014. All three panels also show a vertical line at December 2013, immediately before the rule change beginning in January. The top panel shows that the difference in participation rates is fairly flat over the time period, while the difference in maximum benefits drops abruptly from about 20 weeks to 0 in January. The middle panel shows that the difference in participation is fairly flat over the period, while the difference in benefits drops abruptly in January from a little over 10 weeks to 0. The bottom panel shows the participation rate is fairly flat over the time period, while the difference in maximum benefits falling abruptly from between 5 and 10 weeks to 0 at the time of the rule change.

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