Benefits and Research in the Labour Market

Abstract

‘Discussion of unemployment compensation by economists in the West is typically concerned with its negative aspects' (Micklewright, 1991, p. 419).’ ‘A richer view of the relationship between unemployment and the labour market enables recognition of ‘some of the ways in which [benefits] may have a positive, rather than a negative, impact’ (Atkinson and Micklewright, 1991, p. 1722).’ This paper builds on one presented in Karlstad in June 1996 where I analysed the evidence on the disincentive effect of benefits in the 1994 OECD Jobs Study (Sinfield, 1997). In many respects that paper became a negative exercise, dwelling on the shortcomings in the disincentive evidence and its neglect of alternative evidence. The present paper is directed towards a more positive objective. It attempts to measure up to C. Wright Mills' comment when he gave unemployment as his first illustration of the potential value of the sociological imagination: ‘both the correct statement of the problem and the range of possible solutions require us to consider the economic and political institutions of the society, and not merely the personal situation and character of a scatter of individuals’ (Mills, 1959, p. 123).