Unemployment benefits

[MikeWaters]

Originally Posted by ChinoCoug

Bingo! And unless he's crazy and wants to continue the low consumption, he'll want to get a job, so sending him the checks won't create the bad incentives you're talking about.

I don't think you have an concept of how some folks don't like to work. They would rather watch TV and eat chips, and maybe forgo the latest cellphone or not go out to eat every other day.

So you cry out, what about the children? Fine. Then let's agree that unemployment should never be extended for persons without dependents.

[Archaea]

Originally Posted by ChinoCoug

Bingo! And unless he's crazy and wants to continue the low consumption, he'll want to get a job, so sending him the checks won't create the bad incentives you're talking about.

Some people would rather have lower consumption than work. You may have been too sheltered in life if you have not become acquainted with such persons.

Yes work feels good, but for some, work is an inconvenience.

[ChinoCoug]

Originally Posted by Archaea

Some people would rather have lower consumption than work. You may have been too sheltered in life if you have not become acquainted with such persons.

Yes work feels good, but for some, work is an inconvenience.

Yes, but the phenomena economists are concerned with is not that people prefer lower consumption to work. It is that they consume less and less even while receiving the same amount in benefits. There is no change to the amount you receive, yet you still consume less and less. No one consumes less if they don't have to.

[MikeWaters]

Originally Posted by ChinoCoug

Yes, but the phenomena economists are concerned with is not that people prefer lower consumption to work. It is that they consume less and less even while receiving the same amount in benefits. There is no change to the amount you receive, yet you still consume less and less. No one consumes less if they don't have to.

Which means that they have to consume less. Because they have adjusted to their new lower income.

Surprised that an economist can't see the end of his nose.

I don't know how you could look at this and say that unemployment doesn't disincentivize finding work.

The better thing would be to have the benefits decrease every month to zero.

[ChinoCoug]

Originally Posted by MikeWaters

Which means that they have to consume less. Because they have adjusted to their new lower income.

Surprised that an economist can't see the end of his nose.

I don't know how you could look at this and say that unemployment doesn't disincentivize finding work.

The better thing would be to have the benefits decrease every month to zero.

I don't know how many rounds we have to go through this, but they don't have to consume less, yet they do. Their income isn't lower month-to-month, it's fixed.

[Snowcat]

Originally Posted by ChinoCoug

I don't know how many rounds we have to go through this, but they don't have to consume less, yet they do. Their income isn't lower month-to-month, it's fixed.

Could this not be due to the fact that eventually the benefits will end.

[MikeWaters]

consumption doesn't drop off a cliff when income drops off a cliff. correct?

You are going to see a downward slope in consumption that lags behind the drop in income. Part of the consumption is buffered by savings and debt. As savings disappear, debt increases and income remains fixed, of course it would be expected for consumption to continue to fall. Esp. as Snowcat suggests, the person may be anticipating income of zero, when the benefits run out.

You say that decrease in consumption proves that unemployment benefits are not a disincentive to find new work. I say bullshit. You are making leaps by which you have no grounds to do so.

[MikeWaters]

Slacker nation.

http://www.thedailybeast.com/blogs-a...=hp:mainpromo8

[MikeWaters]

http://online.wsj.com/article/SB1000...ctions_opinion

It takes a genius to figure out that unemployment benefits are a disincentive to work.

[MikeWaters]

So now that unemployment has been extended again, it is now a modern record for the length, and may be an all-time record. There will have been people who have been collecting checks for 2 years. What a wonderful country. We incentivize not working! And require nothing of the people we write checks too!