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Unemployment insurance

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Economics Assignment: Unemployment Insurance Program (UI)
Introduction
Unemployment insurance is one of the programs that has developed widely in the world.
The main purpose of this form of insurance is to support unemployed personalities that are
actively looking for jobs. The aim of this paper is to discuss unemployment insurance program in
relation to economic concepts and theories.
Question 1
The unemployment insurance program provides benefits as long as an individual has filed
an unemployment insurance (UI) claim and meets all the eligibility requirements. Physical
ability to work, being active in looking for work, being partially or totally employed, being
available and willing to accept work, and being approved by a training facility are some of the
eligibility requirements that approve provision of benefits from the program. In addition, one
should have clear details payment information and proper UI debit cards. The benefits are
available to all the workers who lose their jobs and file for the program after officially being
declared as unemployed.
Question 2
The program theoretically helps affected individuals by enabling them to smoothen
consumption across the world and states. To be more specific, the program is vital as it gives
people the ability to save for the spells of unemployment while at the same time pooling the risk

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of unemployment through insurance. Those working reduce the current consumption by saving
for the future harsh unemployment or recess conditions. The program raises welfare by
improving the ability to meet market constraints when one loses their job. In our program, we
care about the problem of miserable quality of life that individuals face when they loose
employment. Therfore, every insurance program should be weighed and justified in accordance
with the magnitude of its benefits to the insured.
Question 3
The economic justification for the UI provision by the government is based on the
insurance-incentive concept which is a tradeoff that involves the design of all insurance
programs. The outcome is enhanced economic recovery and sustenance either when on recess or
when unemployed. The adverse selection problem that exists in the UI private sector is that the
insurer always get a hard time when trying to differentiate between good and bad insurance
behaviors. Quantifying the effort put in searching for work by the unemployed is hard to
determine. Because of this, the insurance is offered at a very high price keeping many out of the
pool of insurance. The result is bad since many individuals that are eligible lack access to the
program.
Question 4
The paternalistic argument for the government involvement in the unemployment
insurance program market is that policies derived to run the program can have an impact on the
behavior of the insurers as well as the people who file for the program. Taking an example, the
requirements put in place can increase sanction after which one becomes eligible for the program
benefits. The condition set in place should be strict so as to ensure that the benefits are realized
only with great eligibility. In addition, the paternalistic argument should be able to offer detailed

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Surname 1 Name Tutor Course Date Economics Assignment: Unemployment Insurance Program (UI) Introduction Unemployment insurance is one of the programs that has developed widely in the world. The main purpose of this form of insurance is to support unemployed personalities that are actively looking for jobs. The aim of this paper is to discuss unemployment insurance program in relation to economic concepts and theories. Question 1 The unemployment insurance program provides benefits as long as an individual has filed an unemployment insurance (UI) claim and meets all the eligibility requirements. Physical ability to work, being active in looking for work, being partially or totally employed, being available and willing to accept work, and being approved by a training facility are some of the eligibility requirements that approve provision of benefits from the program. In addition, one should have clear details payment information and proper UI debit cards. The benefits are available to all the workers who lose their jobs and file for the program after officially being declared as unemployed. Question 2 The program theoretically helps affected individuals by enabling them to smoothen consumption across the world and states. To be more specific, the program is vital as it gives people the ability to save for the spells of unemployment while at the same time pooling the risk Surname 2 of unemployment through insurance. Those working reduce the current consumption by saving for t ...
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