Job displacement insurance in a lower-income country

Study ID sspp-2023-0025-v1

General Details

Project Job displacement insurance in a lower-income country: Evidence From a Field Experiment in Ethiopia
Study ID sspp-2023-0025-v1
Study Title Job displacement insurance in a lower-income country
Authors Girum Abebe, Stefano Caria, François Gerard, Lukas Hensel
Completion Time 15 Minutes
Close Date June 30, 2023
Discipline Economics
Field Development Economics
Country Ethiopia
Abstract
We have designed an experiment to study the welfare and labor market impacts of expanding job-displacement insurance in Ethiopia. A large ready-made garment factory in the Hawassa Industrial Park were laid off a large number of female workers. As is common in low-income countries, these workers will be eligible for a modest lump-sum severance pay and will not receive unemployment insurance. Recent research suggests that many of them will be unable to secure another job quickly, food security will deteriorate, and they will return to their homes in the countryside (Hardy et al., 2022). In this project, we will evaluate the impacts of offering (i) a scheme which pays 60 percent of the worker’s wage for 5 months, irrespective of employment status and (ii) a single lump-sum payment of the same value as the income support scheme. Through phone-based high-frequency surveys, we will study impacts on consumption, job-search, and employment outcomes. We will also look at broader impacts on migration decisions, mental health, and women empowerment. Finally, we will study how exposure to additional job-displacement insurance payments affects the demand for future insurance.

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Citation
Abebe, Girum, Caria, Stefano, Gerard, François, and Lukas Hensel. 2023. "Job displacement insurance in a lower-income country." Social Science Prediction Platform. June 20. https://socialscienceprediction.org/s/d2yaf4

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