Unemployment Compensation throughout the World: A Comparative Analysis

By Wayne Vroman; Vera Brusentsev | Go to book overview

4

Unemployment Compensation in the OECD-20 Countries

We commence the regional analysis with the OECD-20 countries for a number of obvious reasons. First, these countries have the longest continuous experiences with UC programs and a rich historical record. Second, they have influenced the programs adopted in later years by countries in other regions. While the influence of France and the United Kingdom on the UC programs in other countries, particularly former colonies, is most obvious, the UI programs of Germany and the United States have also influenced programs established elsewhere. Third, a wide range of social protection programs and more complete data reporting systems in the OECD-20 countries combine to yield a wider array of data. As a result, a broader set of quantitative analyses can be undertaken for these countries.

The OECD-20 countries have high average per-capita income, extensive social protection arrangements, and well-developed statistical reporting systems. Because of these features, they present several dimensions of information for analysis. Not only is labor market information more extensive, but it is also more readily available than in other regions. Finally, potential analyses are facilitated by the efforts of the OECD, Eurostat of the EU, and the ILO to standardize labor market and social protection information, efforts that have advanced further than in other regions.

As noted in Chapter 3, some problems in UC programs are common to all countries, while other problems are much more pronounced in specific regions. Unusually long benefit duration is a particular problem in the OECD-20 countries. Through their long historical experiences, particularly developments since the mid-1970s, these countries have come to recognize the negative aspects of UC in contributing to long-term unemployment and dependency among a subset of their labor forces. This realization has resulted in initiatives to "activate” the unemployed; that is, institute labor market policies have been designed to shorten the duration of unemployment and increase the likeli

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